The Biggest Bang for Your Buck: Negotiating Retirement Plan Fees

According to plan sponsors, one of the most harrowing aspects of their fiduciary obligations is to ensure that plan fees are reasonable.

However, it is also one of their primary responsibilities. From administration and recordkeeping fees to compliance charges and investment management expenses, how can a plan sponsor feel assured that they are aware of all plan fees, understand them thoroughly, and then determine whether they’re fair and reasonable? It’s quite a task!


Fiduciary best practice dictates the use of live-bid fee benchmarking every three to five years as the exclusively valid method of determining fee reasonableness. Once produced, that analysis serves as documentation of the plan fees falling within a reasonable range.

Or does it? What happens if the data shows that your plan provider’s fees are higher than the bidding providers?

Even though your provider may be meeting your plan needs and service expectations well, you may be concerned if the analysis demonstrates that your plan fees are outside of “normal” range. In this situation, consider engaging Summit Group 401(k) Consulting in a fee negotiation with your provider.


Your incumbent provider should be given the bidding provider range of fees, named anonymously, for their review and consideration.

It’s important to note that the results of Summit Group’s benchmark are based on a live-bid benchmarking process and all bidders are provided with the current plan demographics and plan design/service structure. As such, the results are a true apples-to-apples comparison and thus extremely compelling.

At this point, the incumbent provider would be requested to award a fee concession within range of the bidding providers. In many cases, fees are brought down to at least the mid to slightly above mid-range of fees. Let your provider know that they are not expected to be the lowest, but that you have a fiduciary responsibility to ensure pricing is fair and reasonable for services delivered.

As is the case anytime you negotiate fees, the process can be tricky. As your dedicated plan advisors and consultants, however, we are uniquely qualified and proud to undergo this cumbersome and complex task for you on a regular basis so that you feel confident in meeting your fiduciary obligation to ensure your plan fees are fair and reasonable.

Representatives offer products and services using the following business names: Summit Group of Virginia LLP – insurance and financial services | Ameritas Investment Company, LLC (AIC), Member FINRA/SIPC – securities and investments | Ameritas Advisory Services (AAS) – investment advisory services. AIC and AAS are not affiliated with Summit Group of Virginia LLP, or The Standard. Products and services are limited to residents of states where the representatives are registered. This is not an offer of securities in any jurisdiction, nor is it specifically directed to a resident of any jurisdiction. As with any security, request a prospectus from your representative. Read it carefully before you invest or send money. A representative will contact you to provide requested information. Representatives of AIC and AAS do not provide tax or legal advice. Please consult your tax advisor or attorney regarding your situation.

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