Uniform 401(k) disclosure urged

Participants in 401(k)s should get concise annual summaries of investment, administrative and total plan asset expenses, according to the American Society of Pension Professionals & Actuaries of Arlington, Va. “Even if a participant knows where to look for this information, it is difficult to find and more difficult to understand,” ASPPA and the Council of Independent 401(k) Recordkeepers, a part of ASPPA, said in comments filed on the Department of Labor’s request for information regarding fee and expense disclosures to participants in individual account plans. The disclosures should be made using the Internet, unless participants request them on paper, they said. Information given to plan participants must be disclosed in a consistent manner, regardless of the types of services used by a plan, said the 401(k) service providers. Currently, plans provide inconsistent fee disclosure due to the variety of service provider arrangements and the way fees are determined, they said. Most of the arrangements are either “bundled,” where an affiliated provider offers proprietary investments along with administrative management, or “open architecture models,” in which independent service providers manage plans for multiple funds. ASPPA and CIKR submitted a one-page sample fee disclosure form with their comments.