Rule of Thumb Benchmark for 401k Advisory Fees
Plan sponsors are increasingly aware of their fiduciary responsibility to ensure that their plan only pay “reasonable fees” to their service providers. While commonly used benchmarks on recordkeeping and investment data are readily available, there is far less information on the fees plan sponsors pay to their advisors. The best way for a plan sponsor to benchmark the reasonableness of their advisory fees is to issue a Request for Proposal (RFP). As a quick check, we’ve developed the following grid to help plan sponsors with some quick guidelines on advisory fee data.