[wj]

One of my biggest problems is that what you say is true in the way you mean it but it isn't really true. The way an employer gets at it is passing along all plan costs to the employees who then have their accounts debited every quarter for those costs. I think making employees pay for the benefit really lessens its effectiveness as a benefit (particularly if the plan has no matching).

Another way this is a problem is that the fees are typically debited from the employees based on their balance in an account. So if a 20 person company has five employees with very large balances and fifteen employees with very small balances then the five employees with the larger balances are subsidizing the other fifteen. You end up penalizing the people who have been the most dedicated to saving for retirement.

It seems like Guideline and OctaveWealth (mentioned in the comments) combat this by charging a recordkeeper-style per-participant fee rather than the percentage of assets that are typically charged by advisors and custodians.

[jbtule]

Actually guideline is charging the participant fee as 3bps, which is a percentage of assets (but this is spectacularly low). They are charging the employer directly the per participant fee.

[jbtule]

Whoops, I didn't notice, that 3bps is for the custodian

[busque]

Correct, that's out direct custodian costs. We work hard every day to lower these costs. Custodial services do have value and are worth paying for.