You didn’t know there were fees associated with your 401K?

If so, you wouldn’t be alone.

According to an AARP study, an alarming number of people who have a 401K account weren’t aware of all the fees! In fact, that number was 71% of these individuals. Wow!

Maybe you know there is a fee that goes to your custodian, because it’s fair to pay someone to manage things for you. But do you know about all the rest of the fees?

That’s what I cover in this article. To cut to the chase, click the following link to my video:


The fees explained…

First, there are fees that are much like sales commissions.

Yep! Sales commissions.

Did you know that?

There is the front-end load, which are fees attached to the work done on your portfolio from the beginning.

Then there is the back-end load, which happens when you begin taking out money down the road.

There are management fees, which are to be expected because you are paying to have other people manage your overall retirement portfolio for you.

Here are other associated fees:

  • Director’s and trustee fees, which is something you need to discuss with your custodian for a full understanding.
  • Legal fees, which can’t be avoided. There are legalities involved with any account.
  • Audit fees, because your account will be audited regularly.
  • Shareholder fee, which is an administrative fee.
  • Service fees that may be in place that aren’t part of the shareholder’s fee.
  • Brokerage fee. That’s what you pay to the custodian or broker to handle your 401K plan.
  • 12B1 fee. This was started back in the 1940s and it relates to the advertising side of the fence. It was put in place for mutual fund companies to go out into the world to get more people to put money into their funds. Some of these fees exist today, but I won’t get into this here. It is definitely something you need to ask your custodian to explain.

Fees can run you anywhere from about .5% to 5% of the value within the 401K. Again, because I am not your financial advisor or your custodian, I don’t want to go too far here. Ask your advisors.

I’m just bringing this to you attention because the  fees can make a big difference in the money you get out of your retirement account when it comes time to start pulling the money out.  – Tweet  

In fact, the 1% or 2% taken out of your returns can make a HUGE difference over time… especially 20 to 30 years!! To understand this further, go back and watch the video again. (I go over a bit of math with you to further explain my point.)

Now that you understand the fees associated with the 401K and how they can impact you and your golden years, I have a couple of quick questions for you:

Which of these fees were new to you? All of them… or were you aware of them already?

As always, be sure to leave your answers under my video on my YouTube channel. Or get your conversation started in my private Facebook group.

I’m available to answer your questions 1-on-1 by phone. Use this link:


You can also check out my latest podcasts and collaborations here keeponcashflow.com/podcasts/