401(k) glossary
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Administration
404(a)(5) participant fee disclosure
Short definition
A 404(a)(5) disclosure is the notice a 401(k) plan administrator must give participants about the plan’s fees and investment options, before they first invest and at least once a year after that.
What a 404(a)(5) disclosure is
Department of Labor regulation 29 CFR 2550.404a-5 applies to plans where participants direct their own investments, which covers nearly every 401(k). It requires the plan administrator to give each participant and eligible employee two kinds of information.
Plan-related information:
How to give investment instructions and any limits on them.
Administrative expenses that may be charged to accounts, and how they are allocated.
Individual expenses, such as fees for a loan or a distribution.
Investment-related information, in a chart that lets participants compare options:
Each investment’s name and type.
Performance over 1, 5 and 10 years, with a benchmark.
Total annual operating expenses as a percentage and as a dollar amount per $1,000 invested.
Participants must also get a statement at least quarterly showing the dollar amount of fees actually taken from their account.
Why it matters to employers
The duty belongs to the plan administrator. Recordkeepers normally produce the documents, but if a disclosure is late, wrong or never delivered, the responsibility sits with the administrator. The disclosure draws on the information providers give you under the separate 408(b)(2) rule, so the two should agree.
404(a)(5) and 408(b)(2) compared
404(a)(5) | 408(b)(2) | |
|---|---|---|
From | Plan administrator | Service provider |
To | Participants | The plan’s responsible fiduciary |
Purpose | Help participants make investment decisions | Help the fiduciary judge whether fees are reasonable |
Common mistakes
Missing newly eligible employees who have not enrolled yet. They must receive it before they can first direct investments.
Not sending an update when fees or the fund lineup change.
Assuming a posting on the website counts as delivery without following electronic disclosure rules.
Never reading the disclosure yourself.
Sources
eCFR (National Archives): 29 CFR 2550.404a-5: Fiduciary requirements for disclosure in participant-directed individual account plans (https://www.ecfr.gov/current/title-29/subtitle-B/chapter-XXV/subchapter-F/part-2550/section-2550.404a-5), retrieved 2026-11-11 U.S. Department of Labor, EBSA: Reporting and disclosure guide for employee benefit plans (https://www.dol.gov/sites/dolgov/files/EBSA/about-ebsa/our-activities/resource-center/publications/reporting-and-disclosure-guide-for-employee-benefit-plans.pdf), retrieved 2026-11-11 U.S. Department of Labor, EBSA: Meeting your fiduciary responsibilities (https://www.dol.gov/agencies/ebsa/about-ebsa/our-activities/resource-center/publications/meeting-your-fiduciary-responsibilities), retrieved 2026-11-11
General information, not legal or tax advice.
