Fee Structure of MassMutual TPA Services

[Susan S.]

Is anyone familiar with the general fee structure for TPA work at MassMutual? We have a prospective client with about 25 employees who says MassMutual is charging them $287.50 per year to administer their safe harbor 401(k). It's hard to move the case when this is what the client thinks he is paying. There have to be some additional fees built in, but we can't figure out where.

[hr for me]

http://wwwrs.massmutual.com/rsstaticfiles/retire/firms/edwardjones/rs4950.pdf goes into pretty good depth about the different fees they have and how they are paid. How much is the employers passing through to the employees either directly or through fund management fees?

[ESOP Guy]

A little off topic but I guess this means (at least in this case) all those new fund disclosure rules aren't working!

[GMK]

Offhand, it sounds like revenue sharing is paying the other expenses.

Comparing the expense ratios of the funds in the plan to the expense ratios of the institutional share class of the same funds might give some insight.

And yes, ESOP Guy is right.

[My 2 cents]

Just wondering - there are always announcements at actuarial conferences concerning anti-trust laws and the sponsoring organization's anti-trust policies. Is it acceptable to use these forums to inquire about the pricing/expense structure of other companies?

[hr for me]

I read the posting as trying to figure out what other kinds of fees they could be charging rather than a direct bill to the employer in question. The actual amount charged didn't really matter to the question. I guess we really didn't need to know the MassMutual company name either. I would have answered more specifically (fees taken out of earnings, revenue sharing, etc) without either of those two pieces of information.

Honestly what's been posted isn't enough information to truly see any of the specific the pricing/expense structure by MassMutual for a specific client that MassMutual themselves haven't published out on the www. That's where I got the .pdf. I am not a client, never have been, just googled which anyone can do. Not sure that sharing that is any type of anti-trust violation of policies since it is public information and there are no specifics in that PDF.

(And I don't go to Actuarial Conferences. I am not even a trustee on a 401k plan anymore. Nor do I do recordkeeping or administration anymore.)

[retireholiks]

Whenever the RETIREHOLIKS run into a prospect with a situation like this, we want to determine all applicable fees. We ask em for not only what they write a check for but also a copy of the recordkeeping contract and list of

funds. With those three things the true fee structure can be determined whether bundled or unbundled.