SOURCE: FeeX

July 08, 2015 09:00 ET

FeeX Launches 401k Rollover Center to Show Investors What to Do With Old 401ks

Solution Helps Reduce Excessive 401k Fees in Minutes

NEW YORK, NY--(Marketwired - Jul 8, 2015) - FeeX, a free service that helps investors see and understand fees in their investment and retirement accounts, today unveiled its new 401k Rollover Center. FeeX analyzes the fees associated to a user's inactive 401k accounts and based on this, tells them whether they are better off keeping their investments where they are, rolling them over to a lower-cost IRA or rolling them into their new employer's 401k.

All too often, people suffer from 401k paralysis when changing jobs, uncertain of what to do with the account tied to the old job. Many people lack full awareness of the potential those assets have through their remaining working years. The result: U.S. retirement plans are stuck with tens of millions of stranded accounts.i Many of these accounts come with higher fees, and by keeping their money there and not seeking readily available alternatives, employees are short-changing their retirements.

With more than 53 million people in the United States saving for retirement in 401k plansii and with millions of people changing jobs each year,iii FeeX's 401k Rollover Center arrives at a critical time for providing them with recommendations on how to increase potential retirement savings by minimizing excessive fees.

"When starting a new job, many people don't specify what to do with their former 401k, leaving millions of retirement accounts stranded in limbo -- that's a real problem," said FeeX CEO Yoav Zurel. "A 401k is one of the most valuable assets within a retirement portfolio. That is why we created a tool to show investors how much of their hard-earned savings could be leaking out due to excessive fees. We then show low-fee alternatives."

Research shows fees are highest in smaller 401k plans, which have a median annual record-keeping fee of $70 plus an average of 1.27% of assets.iv By rolling over to an IRA, the annual fee can be eliminated, and the asset-based fee may be reduced to as little as 0.15%. For someone with $50,000 in a 401k plan, this is a savings of about $660 in the first year. Given that fees compound over time this can result in savings of over $83,200 after 30 years.v

The FeeX 401k Rollover Center provides investors with the following:

  • Indicative analysis - if investors are not paying excessive fees in their existing accounts, FeeX lets them know!
  • Display of choices - investors can see side by side fee comparisons of various rollover options, including traditional IRA providers, automated investment services (a.k.a. Robo-Advisors), as well as their new employer's 401k.
  • Impact over time - investors will see all the fees they are currently paying, as well as the impact of the compounding effect between now and the time they retire.
  • Direct links - so investors can easily start to rollover their account right away.

"Crowdsourcing fuels our innovation within the 401k Rollover Center service," said co-founder Uri Levine. "A 401k plan is comprised of a lot of documents and without access to the fee disclosure, there is no way to provide a tailored recommendation. We let our users upload any documents not already in our extensive database to crowdsource the information. This allows us to provide a more comprehensive 401k fee analysis than anything else in the market."

FeeX remains 100% free to users as it has been since its inception. With the introduction of its 401k Rollover Center, FeeX deepens its mission of providing free data and analysis to its users. FeeX is now beginning to receive payments from IRA providers whose platforms can save our users money. Raising revenue in a fair and impartial way has always been part of the FeeX roadmap and will enable FeeX to fund its ongoing goal of helping investors understand and reduce financial fees.

About FeeX
FeeX is a service that finds and helps reduce fees within investment and retirement accounts like IRA, brokerage accounts and more. Simply link investment accounts and FeeX's sophisticated algorithm uncovers advisory, investment and expense ratio fees and suggests alternative ways to save and reduce the cost of retirement. In 2015, Fast Company named FeeX No. 3 of the World's Top 10 Most Innovative Companies in Personal Finance. The company was founded in September 2012 by Yoav Zurel, David Weisz, Eyal Halahmi and Uri Levine -- creator of Waze (which was acquired by Google in mid-2013). FeeX is a Registered Investment Advisor with the SEC. For more information, visit: www.FeeX.com.

i Cerulli Associates estimated 38 million stranded accounts according to a 2009 report.

ii The Investment Company Institute and the Employee Benefit Research Institute.

iii US Department of Labor Bureau of Labor Statistics, June 2015.

iv Inside the Structure of Defined Contribution/401(k) Plan Fees, 2013; Conducted by Deloitte Consulting LLP
for the Investment Company Institute, August 2014. New England Pension Consultants, 2014 Defined Contribution Plan & Fee Survey.

v Based on FeeX calculations, assuming a 6% average annual return before fees.

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