Retirement Plans

Sponsors of 401(k) plans typically don’t provide enough information about the fees charged by mutual funds and other investment products, and Congress should require them to disclose investment and recordkeeping fees that participants bear, according to a GAO report.

The study recommended that Congress amend the Employee Retirement Income Security Act (ERISA) to prohibit plan sponsors from providing the information “in a piecemeal fashion” that makes direct comparisons difficult. Congress also should amend ERISA to require 401(k) service providers to reveal any compensation they receive from other providers, the GAO proposed. In addition, the Department of Labor should require plan sponsors to report summaries of fees paid by participants out of plan assets, the GAO said. The full report is available at www.gao.gov/new.items/d0721.pdf .