MetLife 401(k) Opinions?

[Craig]

Considering changing out our 401(k) (currently with CitiStreet and Smith Barney) to MetLife.  Reviewed investment options, fees, web site, etc. today, and looks like a good plan.  Will include self-directed brokerage accounts for the more sophisticated participants, life cycle funds for those who don't want any hassle, and about 25 funds with a good spread of index and managed, all common 401(k) asset classes.  They use Morningstar's Learning Center for participant education.

Would be interested if any of you have been participants in a MetLife plan, and if so, your opinion.

Thanks.

 

[LEX]

Do the math regarding loads and fees and go with Fidelity or Vanguard

 

[riskadverse]

I've had a 401K under Metlife before and never had any problems. Fidelity and Vanguard on the other hand are fraught with penalties and restrictions.

 

[Craig]

Thanks for the feedback, on both counts.

This program gives me the ability to include Fidelity funds ... unfortunately, not Vanguard directly. However, for only $1,500 per year (company cost), and $150 per year paid by electing participants, our employees can have self-directed brokerage accounts. That will enable them to buy Vanguard funds, ETF's, stocks, bonds, etc. Not perfect, but pretty reasonable.

And, MUCH better than the slug of a plan we have currently.

I prefer Vanguard and Fidelity ... but frankly, the Fidelity web site is very poor. Vanguard's is much better, in my opinion. MetLife's 401(k) web site looks very good.

Still interested in any feedback ... thanks.

 

[Martha]

When we changed our retirement plan at work a few years ago, I asked for proposals from a number of vendors and then looked at them all and tried to compare costs and options. I also had them give us references from businesses similar to ours and we called the references to see what they liked and didn't like about the plan.

 

[Craig]

Thanks, Martha. We did something similar. However, in this case, our IT Manager's wife has spent her career working with 401(k)'s, so we hired her to evaluate roughly a dozen options. I'm confident all commissions were disclosed, a large number of variables reviewed, and since she and her husband will be using it, that should have been another check and balance.

Ended up choosing the MetLife plan ... will include a slate of funds, a set of "life cycle" funds (perhaps Fidelity ... 2015, 2020, etc.), and self-directed brokerage accounts. Only thing I didn't like was relatively high fees on the SDBA's, but they can be managed to some extent, and it will be a distinct minority that will use those.

Thanks again.

 

[MooreBonds]

This program gives me the ability to include Fidelity funds ... unfortunately, not Vanguard directly. However, for only $1,500 per year (company cost), and $150 per year paid by electing participants, our employees can have self-directed brokerage accounts. That will enable them to buy Vanguard funds, ETF's, stocks, bonds, etc. Not perfect, but pretty reasonable.

Charles - about how much do you have in the plan? If it's relatively small (few thousand), it might not be worth the $150/year to invest in the self-directed account (by the way, $1,500/year per employee sounds pretty damn high for the company's cost!). If your balance is higher, it's worth it (make sure you check if you can pay the $150 direct out of taxable funds, rather than having it debited from your 401k account), but if your balance is lower it might be better to wait a few years to accumulate a sizeable amount so the $150/year isn't as high percentage-wise.

 

[Craig]

I didn't state that clearly ... it's $1,500 per year total for the company's cost, and each participant electing to use SDBA's pays an additional $150 per year, plus the commissions / fees. Small cost, IMHO, to provide this benefit.

Agreed on the $150. I'll need to help our employees understand some basic strategy to keep the SDBA fees down.

Thanks.