Retirement Plan Fee Disclosure: Preparing for Participant Questions
The time clock for fee disclosure is ticking. Starting in 2012, the U.S. Department of Labor (DOL) is requiring retirement plan administrators to provide more information about the fees and expenses associated with their plans. The purpose of the DOL regulation is to provide greater transparency and make sure that participants and beneficiaries have the information they need to make informed decisions about the investment of their plan accounts.
As a plan sponsor, you may want to give some thought to how your employees may react to the new disclosures. Some employees may think that you, as their employer, currently pay all the plan costs. When they receive the initial disclosures, they may think they are being charged new fees they didn’t have to pay before. And those who do realize they pay some plan costs may be concerned when they receive disclosures showing how those fees reduce their plan accounts. Here are some questions and answers about fee disclosure and how to prepare your employees for it.