Author Topic: Crappy 401K options, HELP  (Read 1477 times)


  • 5 O'Clock Shadow
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Crappy 401K options, HELP
« on: July 05, 2016, 08:32:40 AM »
Hi all - I'm new to the forum but I'm hoping I can gather some help here. My companies 401K plan is with Wells Fargo and it sucks!!!! There is only 1 index in all of the selections and the fees are crazy. What can i do? I feel like i need the tax benefit of contributing the max amount (i always do this) but its killing me that the options are SO BAD. I've asked that they add several more index funds but nothing has occurred and my HR person is not responding to me. She directed me to the Arthur J Gallagher contact they use to make reco's for the plan, obviously Wells Fargo is paying him. He gave me the most nonsense run around about the fees that i'm still not sure that the hell they are! Wells Fargo is charging 30 basis points to manage the plan but they claim this is paid for by the revenue sharing agreement they have with JP Morgan/Fidelity/Oppenheimer/etc. I couldn't get a clear answer out of him but it sounds like I'm paying the expense ratio on top of that. I asked for Vanguard funds to be added and he was very discouraging, basically saying the fee would be high because they don't revenue share. This is seriously pissing me off. Can anyone tell me what the truth might and what i can do about it? And what the difference is between fiduciary over site and fiduciary standard is? The Arthur J Gallagher said his team has fiduciary over site of the plan. Again, couldn't get a clear answer on what that is supposed to mean.


  • Magnum Stache
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Re: Crappy 401K options, HELP
« Reply #1 on: July 05, 2016, 08:40:28 AM »
Is the index fund an S&P 500 fund?  Is it also the lowest-cost fund other than money-market?  Go with that.

Your 401K is not forever - once you leave this employer, and you certainly will someday, you can roll this over to and IRA and get whatever investments you want.

A 401K has to be truly awful to outweigh the tax benefits for most people.  Even more so if there is a company match.  Truly awful, in my opinion, means roughly >2% annual fees, all in, or even front-load mutual funds.  So don't cut your nose off to spite your face - continue investing and lobbying for better options at the same time.

Exception:  You don't have the intention of maxing all of your tax-advantaged space.  Then you could do this: 401K to get match, then max IRA (traditional or Roth depending on eligibility and your take on taxes now vs taxes when you're drawing), then more to the 401K until you're done investing for the year.


  • Handlebar Stache
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Re: Crappy 401K options, HELP
« Reply #2 on: July 05, 2016, 08:44:59 AM »
Could you post some more info about your particular situation (tax status, income) and the funds with expense ratios and any other fees they're charging you?