Twenty-four percent of participants in small 401(k) plans have balances of zero.
I don't mean small balances due to small contribution amounts, I mean that they have 401(k)s with no money in them. Meaning that these participants are not actually "participating." Meaning that if they gave out awards for retirement investing, these people wouldn't even receive participation trophies.
The average fee that a broker receives from these plans on an active per-participant basis is $157.
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If your compensation is at all based on account balance, that means you're missing out on more than a thousand dollars per plan.
All told, looking at fees per participant, it's at an industry-wide "miss out" of more than $350 million.
While I understand it's not a direct correlation, it's still an important metric to consider. If only because having 24 percent of 401(k) participants not having anything saved for retirement is, in my opinion, a gateway to an epidemic.
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