Press Release

401(k) Averages Book 26th Edition Highlights Continued Fee Compression and Ongoing Disparities in Plan Costs

Issued by 401k Averages Book

Mar. 30, 2026

Continued fee compression highlights the need for fiduciaries to regularly evaluate all components of plan costs

BALTIMORE, MD — The newly released 26th Edition of the 401k Averages Book reinforces a consistent industry trend: investment fees continue to decline across all plan sizes, with most scenarios also showing reductions in total plan costs and advisor compensation. At the same time, the data underscores a persistent reality, smaller plans continue to pay significantly more than their larger counterparts, and cost variation across providers remains substantial.

“Across all scenarios, we are seeing continued downward pressure on investment fees, with total plan costs declining in all but the smallest plan scenario,” said Joseph W. Valletta, CFA, author of the 401k Averages Book. “Advisor compensation was frequently flat, but more scenarios showed declines compared to prior years. At the same time, plan size and average account balance continue to be key drivers of cost, and meaningful disparities persist across plans.”

Key Findings from the 26th Edition

• Investment Fees Continue to Decline Across All Scenarios Investment-related costs decreased in every plan scenario analyzed, with fees declining between 0.03% and 0.06%, reflecting ongoing competition, increased use of lower-cost investment vehicles, including zero revenue-sharing funds, and broader adoption of institutional pricing structures.
• Total Plan Costs and Advisor Compensation Trend Lower In all but one scenario, the smallest plan, total plan costs declined. Advisor compensation was frequently flat, but more scenarios showed decreases compared to prior years, continuing the broader trend of fee compression.
• Smaller Plans Continue to Pay More Despite overall fee reductions, smaller plans consistently experience higher total costs and advisor fees compared to larger plans. For example, a $5 million plan averages 1.04% in total plan costs and 0.37% in advisor compensation, while a $50 million plan averages 0.72% and 0.16%, respectively, reinforcing the impact of scale on pricing.
• Recordkeeping Fees Mixed in Small Plan Market While many segments saw stability or declines, recordkeeping fees in smaller plans were flat to slightly higher in some scenarios, with average increases of approximately 0.03%, influenced in part by evolving 401k Averages Book’s data construction and continued shifts in service and pricing models.
• Wide Cost Ranges Highlight Need for Benchmarking The range of total plan costs remains significant across providers and plan designs. For example, a 50-participant plan with $500,000 in assets shows total plan costs ranging from 0.99% to 3.77%, highlighting the importance of regular benchmarking.

“Fiduciaries have a responsibility to understand and evaluate all components of plan fees, not just investment costs, but recordkeeping and advisor compensation as well,” Valletta added. “Benchmarking is one of the most effective tools available to support that process.”

“With continued litigation risk in the retirement plan space, strong governance practices are more important than ever. Regular benchmarking of plan fees is a critical step in demonstrating prudent oversight and helping ensure participants are receiving competitive pricing.”

What’s Included in the 26th Edition

• 24 plan scenarios covering plans with 10 to 2,000 participants
• Updated fee benchmarks for investment, recordkeeping, and advisor compensation
• Infographics illustrating fee trends and per-participant costs
• Practical reference points for advisors, fiduciaries, and consultants

About the 401k Book of Averages

First published in 1995, the 401k Averages Book (www.401ksource.com) is the only independent benchmarking book focused exclusively on 401(k) plan cost data. With more than 25 years of consistent analysis, it is widely used by fiduciaries, advisors, and service providers to benchmark fees, support governance processes, and inform plan decision-making.

The 26th Edition is available for $95 at www.401ksource.com or by calling (888) 401-3089.

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