If you’re managing a 401(k) plan for your company, you probably know it’s one of the most important benefits you offer. But let’s be honest—how often do you actually take a close look to see if your plan is competitive? Or if your employees are getting the best deal?
At LSC Financial, we’ve worked with lots of businesses who were surprised to find they were paying too much or offering investments that weren’t really helping their people save enough. The good news? That’s where benchmarking your 401(k) can make a huge difference.
What’s This “Benchmarking” Thing Anyway?
Think of it as a health check for your 401(k) plan. You compare your plan’s fees, investments, and features with other companies of similar size or industry. It helps you figure out if you’re paying too much, if your investments are on track, and if your plan is really competitive.
Benchmarking is basically saying: “How do we stack up? Are we doing as well as we could be?”
Why Should You Care About Benchmarking?
1. You’re Legally Responsible
If you’re the plan sponsor, you have a fiduciary duty to act in your employees’ best interests. That means keeping fees reasonable and making sure the plan runs well. Benchmarking shows you’re on top of this responsibility.
2. Fees Can Sneak Up on You
Even small fees add up over time—and can seriously shrink your employees’ retirement nest eggs. If you haven’t reviewed your plan fees lately, you might be paying more than you need to.
3. Better Plans Help Your Employees Save More
When your plan is efficient, with smart investments and easy options, people tend to save more and feel better about retirement. That’s good for them and good for your company.
4. It Helps You Attract and Keep Talent
A competitive 401(k) plan is a big plus when hiring. You want your benefits to stand out—and benchmarking helps ensure that happens.
What Are the Latest Trends?
At LSC Financial, we keep an eye on what’s changing in the 401(k) world. Here are some big things happening right now:
Lower fees: More companies are switching to low-cost index funds instead of expensive mutual funds. It’s a simple way to boost returns over time.
Lower admin costs: Technology and competition mean recordkeeping fees are coming down. But some plans haven’t kept up.
Transparency: Revenue sharing (where investment companies pay providers behind the scenes) is getting phased out. Employers want clear, upfront fees.
Personalized advice: Managed accounts and digital advice tools are growing, helping employees make smarter choices—just be sure the fees are worth it.
How Can You Benchmark Your 401(k) Plan?
It doesn’t have to be complicated. Here’s a quick checklist:
Look at all your fees. Break down what you pay for investments, administration, advice, and anything else.
Check how your investments perform. Are they keeping up with similar funds?
Review how your plan is designed. Are people actually participating? Are you offering features like auto-enroll?
Ask if your providers are competitive. It might be time to shop around.
When Should You Worry?
Some warning signs your plan might not be competitive:
High fees without clear benefits
Poor-performing funds
Low participation or savings rates
Frequent loans or withdrawals
No recent review of your plan
If any of this sounds familiar, it’s time for a closer look.
Your 401(k) plan is a powerful benefit—and with the right benchmarking, it can be a powerful tool for your employees’ futures. At LSC Financial, we make it easy to see where your plan stands and help you improve it—whether that’s lowering fees, boosting investment efficiency, or improving participation.
Want to find out how your 401(k) measures up? Reach out to us for a free benchmarking review and let’s see where you can save money and improve outcomes.
Phone: 361-271-1211
Email:service@admin316.com
Address: 2600 Outrigger Ln, Naples Florida 34104
Hours: Monday – Friday, 8:00 AM –5:00 PM CST