401(k) fees

[Guest cathie giebel]

How common is it for plan sponsors to charge a fee to terminated participants who leave their 401(k) account in the plan?

Are there any surveys showing what an average annual fee would be?

[jaemmons]

I have seen plans charge these type of accounts the same fee that the average IRA custodian would charge in their demographic region, as long as the monies are rollover eligible. However, you must be sure that these type of fees are allowed to be charged to plan participants (language in the document), the amounts are considered reasonable and not excessive, and are charged in a uniform fashion to all employees who decide to leave their accounts in the plan.

[MWeddell]

There's a compliance concern about whether charging only former employees a fee constitutes a significant detriment that violates the cash-out regulation. It is more fully discussed here:

http://benefitslink.com/boards/index.php?showtopic=4161