My company does it's 401k through Human Interest, which charges 0.5% management fee on the portfolio. I think that's ridiculous considering they offer a limited subset of securities you could buy anyways on your own. Does anyone know if it's possible to short out the middleman and go straight to fund managers and security issuers like Vanguard or Blackrock and do a 401k with them? I called Vanguard and it seems they only allow 401k accounts for self employed people. Surely there's another way than letting these middlemen fund managers parasitize off your savings? Edit: No matching from company.
Interested. We use fidelity. Can’t figure out their charge due to their purposely built shitty website
I use fidelity too. One of us should call them and find out if their 401k charges a percentage of our portfolio as management fee.
You should definitely find out. I found out only after a phone call. It was not very clear from the website or documents.
Does your company offer matching? You would not get that going externally. The "management" fee, should not be a flat overall fee. Each fund selection usually has its own fee, because Index funds and require less work, they usually have lower fees. If you have to pay .5% just to hold your money and for the website, it it too much.
You may have a similar % fee on your 401k but don’t know about it due to it being hidden in the fine print. We should get to the bottom of this and find out.
It's just for holding the money. Yes, agree it's too much, but it's also apparently pretty standard, so, would expect a bunch of us to be getting shafted.
I think we use Human Interest too and I had no idea about that management fee. Damn that sucks
How... Is that possible. You work at Robinhood! This is right up your alley. Ok, all kidding aside though, yeah. Pretty shitty service. Human Interest my asd.
You realize that 401k management and a trading platform are very different beasts, right?
Compliance, IRS & Treasury reporting and management (loans, etc.) is a value add. You can quibble about the fee but let’s not get hyperbolic.
From other posts I can guess that like me you’re not so young. Which means you know not to under-estimate the overhead that regulatory filing add to the mix. This is frankly a big part of it. Talk to your accounting department and they’re glad to offload the BS (a giant complexity is also loans). Some employers absorb this cost. I’ve created 2 plans in my lifetime and both times I didn’t pass on the cost. Though tbh, I cut some expensive options like loans. However, with large employee numbers the cost becomes non-trivial and I see some employers trying to cut costs. Point is, a big chunk of this is Uncle Sam’s doing. They could simplify the paper work to match IRA (This is basically what they did with SIMPLE IRA which is a better though less known alternative to 401ks)
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SDA - Does your 401k provider offer that?
What is this? Never heard of it
self-directed brokerage account (SDBA)