via Wall Street Journal
Companies are stepping up efforts to offer lower-cost 401(k) retirement plans, a trend that has already sharply driven down average fees and is likely to continue.
An explosion of information about plan fees has helped increase bargaining power for companies in negotiations with fund providers. And a wave of successful lawsuits against companies alleging their plans had high charges has also led many to seek out lower-priced options for employees.
Meanwhile, a new Labor Department rule that would hold financial advisers to higher standards of behavior for retirement accounts will likely lead smaller plans—where fees remain highest—to cut costs, experts say. The result has been big savings for investors’ combined $4.5 trillion nest eggs.
Plan administrative costs fell to their lowest level in a decade last year, consulting firm NEPC LLC said, and overall fees are expected to keep falling.“I see no end in sight,” said Lori Lucas, defined-contribution practice leader at investment-consulting firm Callan Associates Inc.