Document Type

Fact Sheet

Publication Date



Under a 401(k) plan, your benefit is your vested account balance. This account balance reflects the contributions you make to the plan, the contributions your employer makes to the plan on your behalf (if any), and investment gains and losses.

Many 401(k) plan participants are responsible for choosing how to invest their account balances. If you direct the investment of your 401(k) plan account balance, it is important to understand that fees and expenses may substantially reduce the growth of your 401(k) plan account balance over the course of your working life. The Department of Labor (DOL) estimates that paying 1% in extraneous fees can reduce your 401(k) plan account balance by 28% over the course of 35 years.

Accordingly, it is important to familiarize yourself with the various types of fees and expenses that can affect the growth of your 401(k) plan account balance. This fact sheet summarizes many of these common fees.


This fact sheet was produced as part of the Pension Action Center’s investor education program, made possible thanks to a grant from the Investor Protection Trust, a nonprofit organization devoted to investor education, and support from the Secretary of the Commonwealth of Massachusetts.

Community Engaged/Serving

Part of the UMass Boston Community-Engaged Teaching, Research, and Service Series.


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