Dramatic Fee Savings for Multi-billion Dollar 401(k) Plan


Background

One of the nation’s largest and publicly traded waste management providers asked Blue Prairie Group to assist in evaluating the cost structure of their 401(k) plan and help negotiate lower fees with the recordkeeper. At the time, the plan had over $1.7 billion in assets and over 34,000 participants.

Results

  • Blue Prairie Group secured significantly lower fees, which resulted in lower overall recordkeeping costs. As a result of careful negotiations, the recordkeeper reduced their annual fees from an effective asset-based fee of 24 bps to a better, flat $37 per participant fee, a 38% effective reduction in annual recordkeeping fees.
  • As a result, plan participants saved over $1.5 million in recordkeeping fees in 2012, or $44 per participant.
  • Using an assumed 8% annual growth rate in plan assets, plan participants are expected to save nearly $8.8 million in five years, or $227 per participant.
  • Every dollar saved in recordkeeping fees is a direct transfer from the recordkeeper to the plan’s participants and serves as an excellent example of the client’s commitment to improving the plan for the benefit of plan participants.