Explaining fee levelization —zero revenue sharing through fee credits

Make no mistake, every 401(k) or 403(b) plan has fees related to the administrative costs. Many of the retirement plans we work with use revenue sharing from the plan’s investment options to cover some or all of these fees, which can be a great way to spread out costs.

But there can be a downside for some. With revenue sharing plan participants often pay different proportions of these fees.  To get a better handle on how fees can be allocated, it’s important to review your options. Revenue sharing may be the right fit for some plans, but others may want to consider fee levelization (a.k.a. fee equalization).

Fee levelization allows employers of retirement plans to split administrative costs equally among all plan participants. There are a few ways to do this. Take a look at one option — zero revenue sharing through fee credits — in this short video.

When you’re ready to tee up a fee levelization conversation with a retirement plan client or prospect, consider using this video to help.

Need to explain another fee levelization option?

Want a few more ways to talk about fee levelization?

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The subject matter in this communication is educational only and provided with the understanding that Principal® is not rendering legal, accounting, investment advice or tax advice. You should consult with appropriate counsel or other advisors on all matters pertaining to legal, tax, investment or accounting obligations and requirements.

Insurance products and plan administrative services provided through Principal Life Insurance Co., a member of the Principal Financial Group®, Des Moines, Iowa 50392.

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