September 06, 2012
--- Although the 404(a)(5) participant fee disclosure deadline
has passed, advisers continue to play an important role in helping plan
sponsors and participants understand fee disclosure statements. ---
According to the 2011 Deloitte 401(k) Benchmarking Survey,
one-third of plan sponsors are unfamiliar with the new fee disclosure rules.
When participants receive their third-quarter statements reflecting this
disclosure information, plan sponsors may have difficulty explaining the
Although many participants will not read their statements,
at least one employee from each company will, Bob Kaplan, vice president,
national training consultant at ING Investment Management said during an ING
retirement perspectives webcast, “Five Things Advisors Must Remember About
Participant Fee Disclosure.” The webcast outlined several action points for
advisers to help sponsors in the aftermath of the participant fee disclosure
Kaplan’s first tip is to manage plan sponsor expectations.
Plan sponsors and advisers should work together to ensure participants do not
dwell on fees and, as a result, forget why they are saving in the first place,
In addition to preparing participants for disclosure
information, advisers should evaluate the services they are providing to
sponsors and participants. “When the service is there, fees are not really an
issue,” Kaplan said.