Every 401(k) plan files a Form 5500 with the U.S. Department of Labor each year, and those filings are public. We analyzed more than 549,000 plan year 2024 filings, including about 18,600 from Massachusetts employers, to see what plans report paying from plan assets for administration, recordkeeping, advice and other services. The full results, by plan size, state and industry, are on our 401(k) fee benchmarks page.

Here is what stood out for Massachusetts.

Massachusetts Plans Report Lower Expenses Than the National Median

Among plans that reported any expenses, the median Massachusetts 401(k) plan reported 0.34% of plan assets, compared with 0.45% nationally. Neighboring states landed in between: Connecticut at 0.37%, Rhode Island at 0.39%, New Hampshire at 0.42% and Maine at 0.45%. Florida plans reported 0.53%.

Part of that gap is plan size, but not all of it. Massachusetts plans reported lower expenses than the national median within each size range:

Plan assets Massachusetts median National median
Under $1 million 0.48% 0.55%
$1 million to $5 million 0.35% 0.45%
$5 million to $10 million 0.29% 0.37%
$10 million to $50 million 0.22% 0.28%
$50 million to $250 million 0.11% 0.14%

The Spread Between Plans Is Wide

A median hides a lot. Among Massachusetts plans with $1 million to $5 million in assets that reported expenses, a quarter reported expenses of 0.05% or less, and a quarter reported 0.66% or more. On a $3 million plan, that is the difference between roughly $1,500 and $20,000 a year in reported expenses. Two plans of the same size, offering similar services, can pay very different amounts.

About 17% of Massachusetts plans in that size range reported no expenses paid from the plan at all. That usually means the employer pays providers directly, or that providers are paid through the investments.

What the Filing Leaves Out

The Form 5500 shows expenses paid directly from plan assets. It does not show:

  • Fund expenses. The operating expenses inside mutual funds and other investments are deducted from fund returns, not reported as plan expenses. For many small plans, this is the largest cost.
  • Revenue sharing. Part of a fund's expense ratio may be passed to the recordkeeper or adviser. That payment is real compensation, but it will not appear as a plan expense on the 5500-SF.
  • Fees the company pays. Many employers pay recordkeeping or administration fees from company accounts.

That means a plan with a low number on its filing is not necessarily a low-cost plan. To find your plan's all-in cost, you need the fee disclosure your providers send you each year. Our guide to reading your 401(k) fee disclosure walks through how to add it up.

What Plan Sponsors Can Do

ERISA requires plan fiduciaries to make sure the plan pays only reasonable fees for the services it receives. That does not mean the cheapest plan, but it does mean knowing what you pay and comparing it with the market from time to time. A few practical steps:

  1. Look up your own filing. Form 5500 filings are searchable on the Department of Labor's EFAST2 website. Compare your reported expenses with plans your size on our benchmarks page.
  2. Pull your 408(b)(2) fee disclosure and add up every source of compensation, including what is paid through the funds.
  3. Document the review. Whether or not you make a change, a written record of how you reviewed fees and services is part of a fiduciary's process.
  4. Benchmark every few years, or when your plan's size or needs change.

If you would like a second set of eyes, we offer a complimentary 401(k) fee benchmark for Massachusetts employers, with no obligation. Request a fee review or learn more about our 401(k) plan advice for Massachusetts employers.

Data source: U.S. Department of Labor, EFAST2 Form 5500 and 5500-SF filings, plan year 2024. Figures are medians among 401(k) plans with at least two participants and $50,000 in average assets that reported more than $0 in expenses. See the methodology for details. This article is general educational information and is not legal, tax or investment advice.