Every quarter, I receive disclosure forms from my employer’s 401(k) plans. They discuss my current account balance, my gains and my losses, the fees I’m paying, and a broad look across all the funds available to me. It’s a good quarterly snapshot and one that I felt was adequate. I had online access to my account, so I could review my holdings whenever I wanted to, but for the less technology savvy the once a quarter look was probably adequate.
Looks like the Department of Labor said it wasn’t enough. The Department of Labor recently recommended improved 401(k) disclosure regulations that would require 401(k) plan administrators to provide more information about funds starting in January 1, 2009. This includes 1-, 5- and 10- annualized performance tables for every fund along with their benchmark. It would include annual expense ratio figures and other cost figures. It’s information that my plan administrator always provided so it’s surprising it would have to be mandated. Actually, it’s sad that it had to be mandated.
This simply means that there are workers out there who didn’t have access to this information. While you probably could’ve dug deeper for it, all funds will give you expense ratio figures, making it easier helps everyone.
There are some things missing from the regulations but it’s not a horrible start.
The High Cost of Poor Disclosure [Yahoo! Finance]
One response to “Proposed Improved 401(k) Disclosure Laws”
I think the problem here is your current reports on 401k fees are just a portion of the actual fees. Take a look at the Bloomberg TV special on hidden 401k fees.