(WBNG Binghamton) Many Americans rely on 401k investment plans for part of their retirement, but in a survey by the AARP, two out of three people don't know their plans include dozens of small fees.
Its part of the reason the U.S. Department of Labor has been crafting new rules for disclosure involving 401k fees.
"A number of people are under the mistaken impression they're not paying any fees in their 401k," said Greg Lesko of Lesko Financial. "Everybody is paying some form of fee in their 401k."
For years, the fees were buried in dense disclosure reports making comparing plans difficult.
"If they can offer plans that appear competitive, but will pass on greater fees to them," Lesko said. "They're going to do that."
Fees are often bundled and paid by employers and employees together.
Nearly two years ago, the Department of Labor passed initial rules that helped provide more disclosure.
But this week, the department announced it wants to create a step by step guide plan administrators must include to point employers and employees to each fee listed in their disclosure reports.
"Unfortunately what they found is that it is still not as transparent," Lesko said.
Lesko said he has already seen market demand begin to create more transparency.
"Fees have always been there," he said. "Luckily with transparency and competition, fees have been coming down."
Higher fees can cost a plan member thousands over the life time of their investments which is why it's important to understand them.
The website, Brightscope, is an online search engine for retirement plan accounts.