Sunday, November 6, 2011

Fidelity's 401(k) Recordkeeping Fee

I have been using for some time now to keep track of my finances, and it is really a very nice tool for that purpose.  One of the areas which is nice is that it tells you about expenses that are higher than normal, or that you might otherwise not have noticed.  One such area is that Fidelity is charging me $10 a month $8.50 per quarter as a "record keeping fee" on a 401(k) plan left over from when I worked for HP.  What is especially weird is that they do not charge any such fee on the 401(k) plan left over from when I worked for DSC (absorbed by Alcatel)--and the Alcatel 401(k) is a much smaller balance. They don't have to mail me anything--it is entirely online.  Perhaps once a year I get some notification from them, but I am not even sure if it is that often.

Now, $10 a month $8.50 per quarter isn't that much--but it irritates me that on a six figure balance, they have to ding me for something like that.  Even more important, Schwab is offering me $600 as a bonus if I roll over any 401(k) plans into an IRA with them.  Generally, I prefer not to keep everything in one place, but this would be a nice small addition, and a $120 a year savings that I do not see much reason for me to pay anyway.

Has anyone had any luck with using the threat of pulling a large balance from Fidelity as a way to get them to drop the stupid record keeping fee?

UPDATE: Good suggestion from a reader: the record keeping fee is specific to the HP plan.  I talked to Fidelity this morning; I can roll the money from the HP plan to the Alcatel-Lucent plan and eliminate the monthly fee.  This continues the advantage of not having everything under one institution; diversification is a good thing.


  1. so transfer the HP 401K to the Alcatel account. obviously it has to do with the terms negotiated by Alcate and HP.

  2. I am in the same boat as you, except I don't have 6 figures :( - they've been charging me $8.50 per quarter since I left HP and I didn't realize it until months later. Is Altacel your current employer?

  3. Not for many years. (Actually, never: they bought DSC after I left.)