While your employer might have the best intentions, it doesn't mean that your 401(k) plan is the best suited to you.
Tom Zgainer, CEO at America's Best 401(k), sat down with TheStreet to discuss the retirement savings plans.
"The issue with 401(k)s is we are dependent upon the choice of providers our employer chooses. Now our employers are well intentioned. But they've got his or her heads down running the business and the kind of look at the 401(k) plan as a checkbox item, it's not. We try to have you realize it's a real thing, it's a living thing, it's your money most importantly. So the protection really becomes, did your employer make the best possible choice? Unfortunately, a lot of small business owners are told they don't qualify for low cost investments, or a really low cost plan," said Zgainer.
"That's really not true. It's a matter of the provider saying we can't make enough money off of your plan, so we're going to charge more. Any company, whether it's five employees starting a 401(k) plan for the first time, or one with 550 million in it, can have the lowest possible investments, again well under one percent, in our case just 0.60 percent total investment related fees. We can't control the market, the things that happen in the market day to day seems for no reason in particular why it happens, we have to live with it, we can control the fees we're paying on our 401(k) plan, which will certainly erode it over time," he continued.
You can watch the full interview here.
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