Press Release

401k Averages Book: New Edition Features Advisor Compensation and Other Enhancements

Issued by 401k Averages Book

Feb. 22, 2024

The new book includes advisor compensation and an expanded definition of recordkeeping administration.

BALTIMORE, MD – Pension Data Source, Inc., a leading provider of 401(k) benchmarking data, is excited to announce the release of the 24th Edition of the 401k Averages Book. This comprehensive guide has been updated with valuable feedback from our readers, resulting in two significant enhancements that provide even greater insights into the world of 401(k) plan fees.

The first major enhancement is the introduction of new benchmarking data focused on advisor compensation. Recognizing the importance of advisor contributions in shaping the success of 401(k) plans, the latest edition now includes data on advisor compensation. This addition enables plan sponsors and advisors to make informed decisions, aligning their strategies with industry standards.

The second enhancement is the expanded definition of recordkeeping administration. Responding to the evolving landscape of retirement plan administration, we have broadened the scope to include hard dollar fees, asset-based fees and any allocation from revenue sharing. This expansion allows for a more nuanced understanding of the cost structures associated with 401(k) plan recordkeeping and administration.

"We are thrilled to release the latest edition of the 401k Averages Book, which reflects our ongoing commitment to delivering important insights into 401(k) plan fees. The addition of advisor compensation and the expanded definition of recordkeeping administration further enhances the depth and usefulness of the Book of Averages," said Joseph W. Valletta, author of the 401k Averages Book.

Key Findings from the 401k Averages Book:

• Advisor Compensation declines as plan assets increase: Advisor compensation, as a percentage of assets, for a small plan with $5,000,000 in assets equals 0.37%, while a plan with $50,000,000 in assets is 0.17%.
• Recordkeeping Administration definition change: Hard dollar only recordkeeping fees for a small retirement plan (100 participants/$5,000,000 assets) in the 23rd Edition averaged $47 per participant compared to the 24th Edition’s expanded definition including hard dollar fees, asset-based fees and any allocation from revenue sharing of $165 per participant.
• Plans with smaller average account balances pay more than those with larger balances: A $20,000,000 plan with 2,000 participants has an average total plan cost of 1.26%, while a $20,000,000 plan with 200 participants has an average total plan cost of 0.84%. Included in the Book:
• Twenty-four sections with charts detailing average 401(k) fees for plans with 10, 25, 50, 100, 200, 500, 1000 and 2000 participants.
• The 401k Averages Book includes three easy to read infographics illustrating small plan costs. Each infographic shows the 5-year trend of plan costs, range of participant costs and other key data points.

About 401k Averages Book

Published since 1995, the 401k Averages Book (www.401ksource.com) is the only resource book available for non-biased, comparative 401(k) average cost information. It's designed to provide financial professionals with essential 401(k) cost information needed to determine if their 401(k) plan costs are above or below average. The 24th Edition of the 401k Averages Book is available for $95 and can be purchased by calling (888) 401- 3089 or online at www.401ksource.com

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