New guidance issued by the U.S. Employee Benefits Security Administration can help plan administrators comply with new rules requiring that workers who make their own investment decisions in 401(k)-type retirement plans be provided with certain information about plan and investment costs.
Retirement Plan Fee Disclosures
Beginning later this year, plan administrators will be required to disclose information regarding the fees and expenses associated with 401(k) and similar retirement plan accounts to participants. The new requirement works in conjunction with a second and related rule which requires fee disclosures by certain service providers to plans so that administrators may in turn provide the necessary information to participants.
FAQs Provide Guidance for Compliance
The new guidance responds to frequently asked questions (FAQs) about these rules. Among other issues, the FAQs address questions for plan administrators relating to:
- Timing requirements (note that for most plans, the first initial disclosures must be furnished to participants and beneficiaries no later than August 30, 2012);
- The required form of disclosure;
- Clarification of specific information that must be disclosed;
- The requirement that investment-related information be provided in a chart or similar format that makes it easy to compare the plan’s investment options; and
- The glossary that plan administrators are required to provide to fulfill part of their disclosure obligations.
For More Information
To view the new guidance, please see Field Assistance Bulletin No. 2012-02. For more information on the new rules, you may visit our section on Retirement Plan Fee Disclosure Rules.