• Log In
  • Account Access
  • Contact Us

    Pre-Sales Support

    Mutual Funds and ETFs - 800-456-7526
    Monday-Thursday: 8:00 a.m. – 6:00 p.m. ET
    Friday: 8:00 a.m. – 5:00 p.m. ET

    ETF Trading Support - 415-315-6600
    Monday-Friday: 9:30 a.m. – 5:00 p.m. ET

    Post-Sales and Website Support
    Monday-Friday: 9:00 a.m. - 6:00 p.m. ET

Help Plan Sponsors Balance Costs and Value in Defined Contribution Plans

For DC plans, the lowest fees aren’t a panacea

Did you ever hear the saying, "Balance is not something you find, it's something you create"? In light of recent regulatory changes, 401(k) plan sponsors' heightened fiduciary responsibility has triggered a need for a balance of sorts in the realm of defined contribution plans. Now more than ever plan sponsors are accountable for not only ensuring that participant fees are reasonable, but also that investment options are advantageous. 


“Reasonable” and "low" are not synonymous

Through your conversations with plan sponsors, you've probably noticed that plan sponsors are focusing a lot on fees these days, and many are under the impression that selecting the cheapest plan option is the best approach. But plan sponsors must ask themselves, "Is operating the cheapest plan in the best interest of my plan participants? Does it hinder their long-term savings potential?"

Fees play a large part in sponsors’ fiduciary duties, but just one part. Fiduciary duty is tied to ensuring that fees are reasonable in relation to what the investor receives—not simply "low." Creating a balance between a plan's cost and its value to participants is essential to helping them reach their goals.

According to a study by Mercer LLC, a top priority for DC plan sponsors in 2017 is "appropriateness of fee structures." Plan sponsors must measure fees against the services received. Lower fees make sense, but plan sponsors also need to assess the best fee structure for their plan participants' specific needs and objectives.1


As an advisor, you can assist plan sponsors in effectively managing plan costs with a four-step process

Increased scrutiny and responsibilties need not be stressful to the plan sponsor. We've consulted with Ann Schleck & Co. to provide a four-step process that anticipates and addresses the challenges of finding a plan's cost-value balance: 

1. Establish the plan's fee philosophy and guidelines

2. Evaluate options for improving the cost-value equation

3. Put the plan in writing

4. Measure success


To help you work with plan sponsors to execute the four steps, we supply straight-forward, user-friendly tools 

A four-page overview brochure (MAI072) allows you to introduce the process for evaluating the costs and value of their program and gauge plan sponsors' interest in your assistance with carrying out this fiduciary responsibility.

For plan sponsors who know they want your assistance and are ready to move forward, consider using the in-depth workbook (MAI071) containing tools that specifically pertain to each step. 


Balance is the key

Remember, there's no law requiring an employer to operate the cheapest plan. A retirement plan sponsor's most important responsibility is to operate the plan in the sole interest of its participants. Instead of replacing investments with the least expensive option in order to slash costs, plan sponsors need to balance costs with the value of services and outcomes achieved for participants. Using the strategies and tools we provide will enable you to partner with plan sponsors and their committees, and make important trade-offs and decisions that are right for their plan and their unique workforce.



Next Steps:

  1. Within one week, identify three plan sponsors with whom to discuss balancing costs and value.
  2. Get the Balancing Costs and Value four-page overview by entering your email adress in the box below.
  3. After preparing your elevator pitch using the overview, have an initial discussion about balancing costs and value with the plan sponsors you identified in step 1.

Please enter your email address to download Balancing Costs and Value in Your Defined Contribution Plan overview brochure:




This material is general and information only. This material and the material referenced is not intended to be a recommendation or impartial investment advice. Hartford Funds does not serve as a fiduciary. Hartford Funds intends that the recipient to this communication satisfies the Sophisticated Counterparty exception of the Department of Labor Fiduciary Rule.


Hartford Funds has engaged Ann Schleck & Co. LLC to develop the materials referenced herein. Ann Schleck & Co. LLC is not an affiliate or subsidiary of Hartford Funds.