Are 401k Fees actually this high? I was looking through my Fidelity accounts and focused on the cumulative performance. I noticed my brokerage account had the correct returns on the S&P 500 index, but my 401k account did not. That's when I found this blurb from Fidelity: "The performance calculations are net of fees, reducing the performance by the effect of all applicable fees including, for example, the mutual fund management and annuity separate account fees on your underlying investments and any fees related to their purchase; and bank charges, advisory and brokerage fees related to the maintenance and servicing of your account." The difference between the S&P returns shown on the brokerage and 401k account was 4.79%! Does the 401k really have 4.79% in operating costs per year? #investments #retirement
If the company is smaller have less negotiating power with brokerage, fees can be high. If you are talking about funds that is a different story. Look at net expense ratio of funds.
I believe this is the fees before the target funds it's invested in.
This is so high that I'm thinking of opening an IRA and converting the 401k accounts over to it. Any drawbacks to this? That way, I'm just managing the IRA. If I do a managed IRA it looks like that would only be a 0.35% fee, but I'm thinking I can go without.
Not all funds will allow transfers while you are an employee.
Personal ira limit is less i guess it is 7k$ only for last year. other than that it is same.
They can be. It depends on what the company negotiates and pays the trustee to manage the 401(k).
This wipes away a good percentage of gains per year, wow 🥲. So people with these high fees have mostly the principle they contributed by retirement? Hopefully beating inflation?