I changed jobs this past year previously my 401(k) was through Fidelity, now my 401(k) is being run through Empower. I put all my investments in a target date fund (TIAA-CREF Lifecycle Index 2060 Fund) which I thought had a decent expense ratio of 0.100%. However, I noticed additional fees being taken out of my account and looked into it further. There are fees being taken out called “General Administrative Service Expenses” which equate to $.93 per $1000 quarterly. I barely have $11,000 but 13.60 has already been deducted since I started contributing in May 2021. Is that just a crazy amount to take out or is it just me? Also can I move this money to my previous employers 401k after a certain time to get away from these fees? Thank you for helping me sort this out!
$13.60 of $11,000 is about 0.1%. Annualized it’s probably closer to 0.2%. That’s on top of the 0.1% expense ratio, so in total you might be around 0.3%. These are actually on the very low side as far as 401k fees go. The companies that run these accounts have to get paid and they can’t offer loss-leader 0% rates like consumer facing brands do. So basically, it’s not that bad. Additionally, you’re stuck with as long as you’re employed there. As soon as you leave your employer, I’d recommend rolling over to your own IRA.
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