For the past 9 1/2 years, fee disclosure has certainly helped you as a plan sponsor to finally understand the true cost of plan administration. That’s important because you have a fiduciary duty to only pay reasonable plan expenses.
The problem is that fees are only one part of the picture. You only have to pay reasonable plan expenses and not the lowest, despite what you may think. You need to weigh the cost vs. service. Just hiring a plan provider that is cheap is an absolutely bad idea. Nothing wrong with picking up the same product at a discount at Target than Macy’s, but retirement plan services don’t work that way because plan providers don’t offer the same exact service. Provider A charging $25 a head might be offering a lower level of service than Provider B that charges $50. It’s your job to compare the pricing and services between Providers A and B.
As a plan sponsor, you can’t just shop on price. Price is important, but it’s just one factor in considering hiring a plan provider.
