Broker Check

Understanding Fee Disclosures

February 01, 2023

Thanks to the Department of Labor’s (DOL) fee disclosure rules for 401(k) plans, plan participants now have access to information about how much they’re truly paying—and what they’re getting in return. 

Through a disclosure called a 404(a)(5) Participant-level Disclosure of Plan Fees, employees are informed of the costs associated with your 401(k). On average, these disclosures range from 12 to 35 pages of complex financial terms and calculations. For the majority of 401(k) participants, these disclosures raise more questions than they answer. 

That’s where having access to a financial professional can be a big help. Please feel free to reach out if you’d like to discuss how to help employees understand and make good use of the participant fee disclosures.

 Distributions from traditional employer sponsored retirement plans are taxed as ordinary income and, if taken prior to reaching age 59½, may be subject to an additional 10% IRS tax penalty.