Doctors and the medical community have long known that stress can affect health. One of the top contributors to overall stress levels is worry over finances. A 2012 study from Financial Finesse, a California financial education company, shows the reverse is also true: Reducing financial stress can improve health, and significantly reduce health care costs.
The study was conducted at a Fortune 500 company, and reviewed the differences in healthcare savings between employees who took advantage of financial education opportunities offered by the company, designed to help them resolve financial problems and reduce financial stress, and those who seldom or never used these services. The study showed a 22 percent savings in healthcare costs from 2009 to 2010 among heavy users of financial services, versus 4 percent for non-users. The study also included information from an AP AOL Health Poll showing the effects of financial stress on the body, including migraines,...
Anyone who is responsible for managing a retirement plan like a 401(k) plan is required by law to make sure the plan is operated prudently and that any fees or expenses are reasonable. It’s part of the plan sponsor’s fiduciary responsibilities. However, many plan sponsors don’t know or understand what fees and expenses are, or whether they are appropriate. It’s also important to remember that evaluating fees is an ongoing responsibility–fiduciaries have to monitor fees and expenses and make sure they continue to be reasonable.
Plan fees and expenses come in several varieties, but they generally fall into three categories:
Investment fees. These fees are typically the largest fees paid by the plan, and they are the amount charged to manage the plan’s investments. Management fees (also called investment advisory fees or account maintenance fees) are usually charged as a percentage of the assets invested, and that means they...
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