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Chad Parks is Founder, President, and CEO of Ubiquity Retirement + Savings, formerly The Online 401(k), has helped savers contribute over $1.4 billion towards their retirement since 1999. As one of the first flat-fee-for-service small business plan providers in the nation, Ubiquity delivers peace-of-mind with zero hidden-fees in the fine print. The company is headquartered in San Francisco with satellite offices from coast-to-coast. Read More...

Parks started out as a broker in the financial services industry by growing a portfolio of individual clients at San Francisco’s Piper Jaffray. Driven by a desire to better serve his clients while anticipating the phasing out of the traditional broker model, Parks left Piper Jaffray in 1997 to obtain his CFP designation and start his own fee-for-service, independent financial planning practice, Retirement & Education Group, Inc.

In his financial planning practice, Parks came across many small business owners looking for cost-effective and quality retirement plans. Finding the small business market highly neglected and underserved, Parks saw the opportunity and took it by launching The Online 401(k). Today, Ubiquity serves more than 7,000 small business customers in 50 states, providing solutions both directly and through partners, such as Zenefits, Charles Schwab & Co. and Morningstar, as well as payroll companies, financial planners and CPAs.

Parks has been quoted in many financial services as well as national publications such as The Wall Street Journal, The New York Times, Fox Business, Yahoo! Finance, USA Today, CNN Money, Bloomberg Wealth Manager, Business Week, Entrepreneur and Plan Sponsor for his considerable work performed in the space of small business retirement as well as his foray into documentaries with his independently produced Broken Eggs Film, released in 2014.

With his extensive work in Washington DC in getting legislation passed in order to stop the practice of hiding fees in the fine print, Parks has become the go-to expert on public policy as it relates to 401(k), as well as the looming retirement crisis in America, and what we can do to fix it.

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March 16, 2012 at 11:40 am
Retirement News

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Fee disclosure is coming this year for employers who provide and employees who save in 401(k) plans.

It has been more than a decade in the making. It has technical terms like 408(b)(2), and 404(a)(5). Want that in plain English? Good, we are here to translate.

Why disclose?

What most people don’t know about their retirement plan is that there indeed hidden asset-based fees being charged to your account.

Your employer has responsibility to ensure that they are providing you a ‘good’ plan.

And now the Department of Labor has issued regulations that require the industry to tell you what those fees are.

Simple enough.

Employers will be told who and what is being paid in terms of real dollars and how much they are paying. Many, I predict will have sticker shock. What you don’t know can hurt you. But at least now you know. Act accordingly.

But for employees, is where this falls short. It is you the employee (and you the employer if you are saving for your retirement in your own plan) who are really paying for it, in more ways than one.

Consider this.

With asset-based fees, the more you have in your account, the more you pay in fees. Sort of like our tax system, so there is precedent.

Example: If your plan has ‘extra’ asset-based fees of say 1%, if you have $100,000 saved, you are paying an extra $1000 in fees. If your co-worker has $10,000 saved, they are paying an extra $100 in fees. Just as your balance is 10 times greater than your co-worker, so are the fees you are paying.

That would be nice to know wouldn’t it? But that unfortunately is not going to happen this time around.

The regulations do not go far enough, and still leave employees in the dark.

The point of knowing is so you can make informed decisions, find a better provider, and put some of that money back in your own account. They exist, we are one of them!

So, while it may not be business as usual, thanks to the fact that your employer will have more information to work with, you will still have to dig hard to figure it all out.

We are working for further change, and working on your behalf. Have been for 13 years. Take a minute to think about it, and let me know if you have questions. I’m betting you do.