CHICAGO--(BUSINESS WIRE)--A recent study conducted by the Plan Sponsor Council of America (PSCA) on the impact of fee disclosure regulations shows that the overwhelming majority of defined contribution plan participants have not changed their behavior based on the fee disclosure information they have received.
“The survey results echo what we have been hearing anecdotally. Participants are receiving their notices, but they aren’t calling or asking questions. Participants either aren’t reading the disclosures or they don’t seem to be surprised by the fees they pay.”
“Clearly, the results raise questions about the costs incurred in complying with the regulations,” said Bob Benish, PSCA’s Interim President and Executive Director. “The survey results echo what we have been hearing anecdotally. Participants are receiving their notices, but they aren’t calling or asking questions. Participants either aren’t reading the disclosures or they don’t seem to be surprised by the fees they pay.”
PSCA’s snapshot survey on the impact of fee disclosure regulations on participants was conducted in October 2012, and received 176 responses from defined contribution plan sponsors. 95.6 percent of plan sponsors reported no change in participant behavior as a result of the fee information. An average of 1.4 percent of participants asked questions regarding the fee disclosure information they received.
“If anything, the fee disclosure has just made consumers more conscientious,” Benish said.
Additionally, as a result of the service provider fee disclosure requirements, 15.4 percent of plan sponsors sent out an RFP/RFI. This shows that plan sponsors are doing their due diligence to make sure that the fees their participants are paying are reasonable.
PSCA is now conducting a comprehensive fee benchmarking survey in response to requests from plan sponsors for an unbiased, comprehensive source of data to use in evaluating their plan fees to comply with the 408(b)(2) regulations. Participants will receive a free copy of the results and members that participate will receive a free customized fee benchmarking report that compares their fee information with aggregate data for similar size plans.
The full results of the snapshot survey and more information about our fee benchmarking survey can be found on PSCA’s website at http://www.psca.org/research.
About the Plan Sponsor Council of America
PSCA, a national non-profit association of 1,200 companies and their six million employees, advocates increased retirement security through profit sharing, 401(k) and related defined contribution programs to federal policymakers. PSCA makes practical assistance available to its members with profit sharing and 401(k) plan design, administration, investment, compliance and communication materials. PSCA, established in 1947, is based on the principle that “defined contribution partnership in the workplace fits today’s reality.” PSCA's services are tailored to meet the needs of both large and small companies with members ranging in size from Fortune 100 firms to small, entrepreneurial businesses.