Labor Department Releases New 401(k) Disclosure Regulations

1:20 pm Uncategorized

New rules requiring companies that provide 401(k) plans to employees to outline all plan fees and charges in plain language will go into effect beginning Jan. 1, 2012.

In announcing the new rules, Secretary of Labor Hilda Solis said that employees need more and better information that would enable them to make knowledgeable decisions about their investments.  Solis said the new rules would affect approximately 483,000 retirement plans of 72 million American workers.

Under the new rules, quarterly 401(k) statements have to include information on plan administration expenses and the charges that result from the investment decisions made by the plan owner, including loan fees.  All fees and expenses must be shown as a percentage of the assets held as well as a dollar amount for each $1,000 invested.

Mutual fund performance data must also be outlined in one-, five- and 10-year returns.  Plan holders must be provided with relevant benchmarks so they can understand how their funds are performing.

Companies must also provide individuals with a glossary of common terms so they can better understand their investment choices and the fees and charges associated with each choice.

To understand all your options for retirement planning, contact our California estate planning law firm.

Let our Costa Mesa law offices help you get started by contacting us today.

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