WASHINGTON–The Department of Labor is asking interested parties to provide guidance on what kind of information participants in 401(k) plans should have about the fees and expenses charged by the companies that run their plans.
The DOL’s request for information, to be published Wednesday in The Federal Register, will also ask for advice on the format that should be used to provide the information to participants as well as who should provide that information. The DOL wants the comments in hand by July 24, according to The Federal Register notice.
The request for information reflects the heightened interest the agency has in improving disclosures not only to plan participants but also to plan fiduciaries and the government about the fees paid to administer 401(k) plans, according to Jan Jacobson, director, retirement policy, the American Benefits Council, Washington.
“This is consistent with the DOL’s pledge to improve information on the costs associated with 401(k) plans,” Jacobson said.
“The information is currently available, but only through various sources now, such as the prospectus for the mutual fund,” Jacobson said.
She noted that the ABC is already providing comments about fee disclosure informally to the agency.
The average plan participant is unlikely to pull information about fees from the various resources available, she noted. Although members of the industry say they support improved disclosure, they insist the requirement needs to be not only valuable to the participant but cost-effective as well.