Section 408(b)(2), a 2011 regulation from the Department of Labor, requireed retirement plan fiduciaries, including plan sponsors and investment committees, to understand all fees and expenses associated with their retirement plan. Plan sponsors must also be able to determine if their fees are competitive, or “reasonable” in relation to the services they receive.
The new regulation required:
- The contract or arrangement must be in writing and reasonable.
- The services being performed are necessary to establish or operate a qualified plan.
- No more than reasonable compensation is paid for the services performed.
The DOL required compliance with the regulation on or before Jan. 1, 2012.
Source: Oswald Financial