Our Low Participant Fees
Why ShareBuilder 401k offers only low-expense index funds
The ShareBuilder fund line-up is built on the investment
philosophy that managing the factors that can be controlled is the most effective
way to help investors succeed. Fund costs, or expenses, are a key factor. In fact,
a recent study by Morningstar found that "in every single
time period and data point tested, low-cost funds beat high-cost funds!"
Yes, the impact of high fund expenses can take a big bite out of how much you have
come retirement. Over 30 or 40 years, high fees can mean having several hundred
thousand dollars less in savings.1 Index funds typically have noticeably
lower expense ratios than actively managed funds. Just consider that ShareBuilder's
model portfolios have an average expense ratio of
0.17% — that's nice and low! Add in all the fund fees that participants pay
in retirement plans which can cover everything from advisory fees to recordkeeping
to distribution, and few can compare to ShareBuilder 401k.
This chart may be handy as you consider how participant fees tend to vary by the
amount of money (assets) and participants in a plan — the key being how much
money:
|
Plan assets
|
Number of
participants
|
Industry average
participant fees2
|
ShareBuilder 401k
|
ShareBuilder's advantage
|
|
$250,000
|
25
|
2.76%
|
0.92%
|
67% less
|
|
$2,500,000
|
50
|
1.48%
|
0.72%
|
51% less
|
|
$10,000,000
|
200
|
1.25%
|
0.62%
|
50% less
|
To learn more about the advantages of index-based investing, just
read this guide.