Gilfix & LaPoll Recommends Examining 401(k) Fees
Palo Alto, CA (Law Firm Newswire) December 30, 2013 – Most workers who participate in 401(k) plans are trying to save enough for a comfortable retirement and perhaps an inheritance for their children and grandchildren.
A prominent estate planning attorney says that while 401(k)s are a good way to add to one’s retirement savings, it is important to take a look at the fees a plan charges, as these fees can erode one’s savings.
“Employers are now required to provide workers with more information about the fees connected with administering 401(k)s and the different investment options they provide,” said Michael Gilfix, a Palo Alto estate planning attorney.
In 2012, the Labor Department began requiring employers to provide additional information about fees. The administration expenses of a 401(k) plan can be significant. One estimate found that fees on some plans can erode up to 30 percent of a person’s retirement savings. Industry experts expected workers to pressure their employers to switch to plan administrators that charge lower fees, but the number of these requests has not matched predictions. The nonprofit Employee Benefit Research Institute found that only 53 percent of participants in 401(k) plans noticed the new disclosures, and most of those did not do anything about it. That may be a mistake, says Gilfix.
“One easy action you can take is to switch out of the types of investment options that carry higher fees,” said Gilfix. “It’s important to pay attention to your 401(k) plan to make sure you are getting the best possible return on your investment, and that includes avoiding fees whenever you can.”
It may be that many people do not take action because they do not have enough information to judge whether fees are too high. One solution is a service such as Brightscope, which rates 401(k) plans and includes a database of information about fees. CNN Money also has a free tool available that allows workers for large companies to compare 401(k) fees. Tools such as 401kfee.com allow one to calculate the impact of fees on one’s retirement savings.
“The important thing is to take charge of your own retirement plan and estate plan,” said Gilfix.
Facebook: Like Us!
- Adult Siblings of Special Needs Individuals Find Considerations and Resources in California
Advances in medicine and expanded support services have allowed many individuals with disabilities to live longer than ever before. As a result, an increasing number of siblings will replace their parents in caring for and supporting special needs adults. While many resources exist for the parents of adult children with disabilities, new resources specifically designed […]
- Talking to Dad about his driving: the surprising side of difficult conversations
Do you think it will be tough to ask Dad to hand over the keys? Surprisingly, a recent study from Liberty Mutual showed that 84 percent of seniors are open to talking about the safety of their driving, but that only six percent have actually had the discussion. As Liberty Mutual put it, “Seniors are […]
- Setting up a special needs trust: three reasons to start sooner
When preparing for the future of a child or family member with a disability, many parents and guardians plan to set up a special needs trust. This unique kind of trust can provide for many of the supplemental needs of a disabled person without jeopardizing that person’s eligibility for vital government benefits, including Medi-Cal and […]
- Michael Gilfix discusses Medi-Cal asset seizure in Mercury News
A growing number of older Californians are concerned about Medi-Cal asset seizure, according to a new article from the San Jose Mercury News. The California State Assembly recently passed a new bill designed to limit Medi-Cal’s ability to recover assets from the estates of deceased Medi-Cal beneficiaries. As the law stands currently, Medi-Cal can seize […]
- Long-Term Care Insurance: Options Abound, As Do Complications
Long-term care insurance has become a critical topic as health care costs continue to rise. The U.S. Department of Health and Human Services estimates the average annual cost of U.S. nursing home care to be $74,820. But in California, the Department of Health Care Services estimates that cost to be $91,250. Recently, public debate about […]