Reducing Costs of 401(k) Plans with ETFs and Commingled Trusts
AbstractIncreasingly, employers who provide their employees with a retirement plan are relying on 401(k) and similar defined contribution plans instead of defined benefit plans. As a result, participants are paying more of the cost of managing their pension plans, which can take a substantial toll on their retirement savings. Over a 30 year career, for example, an annual fee of 0.7% of assets reduces the purchasing power of a participant's balance at the time of retirement by more than one-eighth.
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Bibliographic InfoPaper provided by Center for Retirement Research in its series Issues in Brief with number ib2010-11.
Length: 7 pages
Date of creation: Jul 2010
Date of revision: Jul 2010
Publication status: published on the Center for Retirement Research at Boston College website
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- Alicia H. Munnell & Jean-Pierre Aubry & Laura Quinby, 2010.
"Public Pension Funding in Practice,"
NBER Working Papers
16442, National Bureau of Economic Research, Inc.
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