No true understanding of costs, commissions, and fees.
These costs fall into one of two categories, the first
being investment costs you can see, and second those you cannot…..aka
those that are hidden from the plan participants. Bear in mind the plan
sponsor needs to know all of the costs in order to comply; which can be
daunting when it comes to hidden fees.
Independent Analysis
One way to find these costs is to have an independent
analysis or review done on your plan. This review should determine what the
hidden costs are, what they mean and how they apply. It
should also reveal other plan fees such as investment management fees, contract
fees, commissions, provision for loan fees, pension fees, and etc.etc.
The Take Home
Plan sponsors and fiduciaries have a responsibility to
know and understand all costs including those hidden from participants.
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