Call the cops — your pocket’s been picked.
American workers are being ripped off by excessive retirement plan fees — which may force them to work longer or live less comfortably in their golden years, according to a recent study.
For the average US household, the high fees drain about $155,000 from their 401(k) accounts over their lifetimes, the study found.
In one example highlighted in the study, a two-wage-earner household with a median income for their age group contributed an average of 7 percent a year to their 401(k) plan over 40 years.
They earned an average annual return of 8.5 percent. Because of fees of some 2 percent a year on their 401(k) plan, they ended up with a balance of only $354,000 — $150,000 less than they would have had but for the fees.
“That $150,000 or so could have made a tremendous difference in the lifestyle of the couple,” said Robert Hiltonsmith, a policy analyst at Demos, which published the study.
REPORT: The Retirement Savings Drain: Hidden & Excessive Costs of 401(k)s
Higher-earning households can pay as much as $278,000 in fees, Hiltonsmith found.
