Forbes Provides Primer on Whether to Sue Your 401(k) Plan

To sue or not to sue your employer over your 401(k) plan? That is the question that a Forbes guest columnist poses to plan participants, providing red flags that participants should look out for when determining whether to sue or not.

Citing abuses like high fees charged to federal employees rolling out of the low-cost Thrift Savings Plan and Fidelity’s recent settlement with participants in their own plan, author John Wasik recommends that employees ask the following questions:
• Are low-cost index investments offered?
• Are various markets covered by the investments offered?
• Are fees excessive?
• What fees are paid to middlemen (suggesting that revenue sharing is a red flag)?
• Are there wrap fees, which Wasik says are a no-no?
• Does the record keeper only offer proprietary funds?

If employers don’t answer these questions with a promise to hire an independent fiduciary consultant, Wasik recommends consulting an attorney.