DES MOINES, Iowa – Quarterly 401(k) statements are going to start offering more guidance about exactly where your money is going.
The Department of Labor says it will require companies providing 401(k) accounts to lay out all the fees and other charges in plain language beginning Jan. 1, 2012. The new regulations, announced by Secretary of Labor Hilda Solis, will affect about 483,000 retirement plans. She said the 72 million workers enrolled in 401(k) plans will begin to have the detailed information they need to do easy comparisons of the costs of their investment choices.
Companies must begin to lay out the administrative expenses, including accounting and recordkeeping fees, and the charges that apply to the individual choices a worker makes, such as fees charged for loans.
Solis said current laws don’t require sufficient information that allows workers to make the best investment decisions.
“Even if workers were given abundant investment information, they didn’t always receive it in a user-friendly format,” Solis said. “Again, the law simply didn’t require it.”