Frequently Asked Questions

What is FeeMetri(k)s?
FeeMetri(k)s turns 401k and 403(b) decision-makers into fee experts in under 5 minutes by giving them the data and analytics they need to know exactly what other comparable companies are paying across the industry. With unparalleled fee transparency and real-time pricing intelligence you won’t find anywhere else, FeeMetri(k)s arms you with the data you need to make informed decisions, negotiate the best deal for your employees and manage your fiduciary risk so you keep your company and yourself out of legal trouble. With FeeMetri(k)s, you’re in control and you’ll never get “sold” a high-cost 401k or 403(b) plan by the retirement industry again.
Why does my company need to be concerned about the fees in our retirement plan?
Three reasons.

1. 401(k) and 403(b) litigation is exploding and more companies are being sued by participants claiming fiduciaries have breached their duties under ERISA by failing to make prudent fee decisions resulting in participants paying excessive fees.

2. Fees have been shown to be the most reliable predictor of future investment returns. In fact, in a 2010 study entitled “How Expense Ratios & Star Ratings Predict Success”, Morningstar concluded that “investors should make expense ratios a primary test in fund selection. They are still the most dependable predictor of performance.”

3. 401(k) fees can have a dramatic impact on participants’ account balances and retirement income over time. For instance, in the publication “A Look At 401(k) Plan Fees”, the DOL has estimated that a 1 percent difference in fees and expenses would reduce your account balance at retirement by 28 percent.
What are some examples of 401(k) and 403(b) fee lawsuits?
Companies like Lockheed Martin ($62m settlement), Boeing ($57m settlement), Caterpillar ($16.5m settlement), Walmart ($13.5m settlement), Mass Mutual ($31m settlement), International Paper ($30m settlement), Ameriprise Financial ($27.5m settlement), Fidelity ($12m settlement), Anthem ($23.7m settlement), Oracle ($12m settlement), and many others have either settled or are currently engaged in lawsuits related to excessive fees. St. Louis law firm Schlichter, Bogard & Denton has won over $300m in settlements against plan sponsors over the past decade by itself. More recently, colleges and universities like the University of Chicago ($6.5m million settlement), Duke University ($10.7m settlement), Brown University ($3.5m settlement), Vanderbilt University ($14.5m settlement) and Johns Hopkins University ($14m settlement) have been targeted.
Why are 401(k) and 403(b) fees difficult to benchmark and why should my company consider using FeeMetri(k)s?
ERISA (the law that governs qualified retirement plans) has always required that plan fiduciaries ensure that 401(k) fees are reasonable in light of the services being provided. Unfortunately, plan fiduciaries have often had trouble fulfilling this requirement for three reasons.

1. The retirement industry has done a terrific job of making fees hard to decipher and understand.

2. There is an overall lack of accessibility, accuracy and meaningful context in regards to 401(k) fees. Form 5500 data is typically outdated and incomplete, fee disclosures (commonly known as 408(b)(2) statements) are too often confusing and complex, indirect compensation such as revenue sharing can misrepresent who is receiving compensation and to what extent, and the process of finding meaningful comparisons is difficult and time-intensive.

3. Without the right data and insider knowledge of the industry, most companies struggle to negotiation the best deal possible for their employees.
How is FeeMetri(k)s different than other fee benchmarking solutions?
Though few similar tools currently exist, the ones that do in most cases lack accurate, real-time data and comparison metrics to make the information useful and actionable. For example, if you read the fine print of these solutions you will often find that the information is not based on actual real-time plan data but on plan sponsor surveys, requests for proposal, standard provider fee schedules or Form 5500 data that is incomplete or out of date. FeeMetri(k)s actually provides extensive, real-time data submitted by plan sponsors and uses comparison metrics you won’t find anywhere else which empowers you with the insights and analytics you need to make better decisions for your people and your company. FeeMetri(k)s also provides the ability to create historical snapshots so you can track how your fees change and you can document a sound and consistent fiduciary process over time.
What comparison metrics does FeeMetri(k)s provide?
FeeMetri(k)s provides 8 different comparison metrics based on comparable sized plans in terms of total assets and number of participants. These comparisons include fund fees, administrative fees (e.g. recordkeeping, administration, compliance and custody), advisory fees (if applicable), provider firm fees (e.g. Vanguard, Fidelity, T. Rowe Price, etc.), advisory firm fees (e.g. Merrill Lynch, Morgan Stanley, UBS, etc.), industry and region. The provider firm and advisory firm fees are especially powerful and unlike anything else in the industry. For example, if you use Fidelity as your provider you will be able to see how your fees compare to all other similar plans in the database that use Fidelity as a provider. This level of detail empowers you with the data you need to negotiate with your vendors more effectively, increase accountability and make better decisions for your people and your company, leading to better outcomes over time.
Why should my company pay for FeeMetri(k)s rather than using free tools that may exist?
Because you get what you pay for. If the data you are using is outdated, incomplete or inaccurate your efforts and outomes will be ineffective. Also, if anybody is benchmarking your plan for "free" they are either using your data to make money or trying to sell you something (nobody works for free!). FeeTelligence provides the most extensive, real-time data submitted by plan sponsors and advisors and uses comparison metrics you won’t find anywhere else. The result is you can always quickly and easily be sure your fees are competitive with the marketplace, you can document a sound and consistent fiduciary process and you can leverage the data and insights to make better decisions for your people and your company, leading to better outcomes over time.
I'm really busy.  How much work is involved on my end?
Very little!  Once you subscribe, you'll receive a link to fill out a short questionnaire and upload your fee disclosure notices from your service providers (these are known as 408(b)(2) notices).  We will take this information, upload it to the system for you, and send you a link to your account.  Then we'll send you a reminder email 1x per year to send us the updated notices.  That's it!
Can FeeMetri(k)s help us renegotiate our fees?
Yes! We offer an optional contingency-based fee negotiation service for companies that need help. Please contact us to learn more.

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