On inquiry, it seems the 401(k) plan was purchasing Class N shares with a higher expense ratio, compared with Class A shares, which the general public would purchase.
When I told the financial adviser the expense ratios were too high, I was told there is nothing that could be done. They were wrong.
I am now in the process of switching my company’s plan to a different financial adviser, who is allowing us to access all Class A shares and have a fee explicitly charged, which, on balance, will net out to a savings of about 40 basis points. I believe we will have better performing funds, in addition.
Please advise the readership to be on the alert for these different share classes with higher expense ratios.
Gary Pokrassa, CPA