Short answer: To compare 401(k) pricing, total every cost on a like-for-like basis: what the company pays to run the plan, what employees pay through their accounts and investments, and any one-time setup or transfer costs. Then weigh that total against how much work each provider takes off your team. At Basic Capital, pricing is tailored to each plan, and we’re consistently competitive.

Where 401(k) costs come from

• Plan administration and recordkeeping. Running the plan, tracking each account and processing contributions. The recordkeeper usually charges the company, though some plans pay it from plan assets.

• Investment expenses. Each fund’s expense ratio, taken out of returns. Employees pay these.

• Participant account fees. Flat or asset-based fees charged to employee accounts, sometimes funded through revenue sharing.

• Fiduciary and advisory services. A 3(21) or 3(38) fiduciary for investments, or a 3(16) administrator, if the plan uses one.

• Compliance and reporting. Annual nondiscrimination testing, Form 5500 preparation and required notices.

• Setup and transfer costs. Onboarding, connecting payroll and moving assets from a previous provider.

Who pays what

Some costs land on the company and some come out of employee accounts, so a low employer fee can hide higher participant costs. Two disclosures show the full picture: the 408(b)(2) disclosure your plan’s service providers give you as plan sponsor, and the 404(a)(5) disclosure employees receive about the fees charged to their accounts. Read both side by side when you compare.

Questions to ask every provider

1. What is included in the quoted price, and what is billed separately?

2. Are there setup, onboarding or transfer fees?

3. Which costs does the company pay, and which come out of employee accounts?

4. What are the expense ratios of the default investments?

5. Does pricing change as headcount or plan assets grow?

6. Is the payroll connection included, and how much of it is automated?

7. Who handles testing, Form 5500 and notices, and is a fiduciary role included?

Compare the work, not just the fee

Two plans with similar headline prices can create very different workloads. Check how contributions get from payroll to the plan, who catches compliance issues during the year, and how easy it is for employees to enroll and manage their accounts. Hours your team saves, and mistakes it avoids, belong in the comparison too.

How Basic Capital approaches pricing

Pricing is tailored to each plan, and we’re consistently competitive. To see what it would look like for your company, book a demo and compare our proposal against your current plan using the questions above.