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The annual fee-disclosure statement will not be simple. "It's lengthy, wordy, and there is a bit of complexity," says Dave Gray, vice president of client experience for Charles Schwab. Typically the annual disclosure statements will range from seven to 12 pages, he says.
Not all plans will provide a total dollar amount of a participant's plan costs in the new quarterly statement. Expenses that are subtracted from the total investment fund's revenue do not have to added into the cost statements. So if a portion of a mutual fund's management fees is shared with a record keeper of the plan, it can be built into the cost of the fund, the DOL says. That would reduce the returns that fund investors receive.
Those types of fees will show up in the annual report because they are included in the expense ratio of the investment options. Even if they are not added into the cost total, the quarterly statement is supposed to explain those types of fees to consumers, the DOL says.
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ReplyDeleteThe annual fee-disclosure statement will not be simple. "It's lengthy, wordy, and there is a bit of complexity," says Dave Gray, vice president of client experience for Charles Schwab. Typically the annual disclosure statements will range from seven to 12 pages, he says.
Not all plans will provide a total dollar amount of a participant's plan costs in the new quarterly statement. Expenses that are subtracted from the total investment fund's revenue do not have to added into the cost statements. So if a portion of a mutual fund's management fees is shared with a record keeper of the plan, it can be built into the cost of the fund, the DOL says. That would reduce the returns that fund investors receive.
Those types of fees will show up in the annual report because they are included in the expense ratio of the investment options. Even if they are not added into the cost total, the quarterly statement is supposed to explain those types of fees to consumers, the DOL says.