EXCERPT:

""....Some of the new e-401(k) startups are offering free setup to companies that choose their plans. But don't forget to ask about the sales fees that are assessed on each of your participant's accounts as a percentage of the balance, as well as administrative fees. "Make sure you take into account all asset-based fees when you calculate the cost of providing the plan," warns Huntley. These fees are far and away the largest chunk of any plan's cost.......For the average 25- to 50-person plan, you can expect to pay administrative expenses of about $2,000 a year, compared with $3,000 to $4,000 for a traditional 401(k) plan. However, costs for online plans vary. For a 25-person company, Fidelity charges $2,250 a year...." "The word is getting out in that clubby environment that there's a new player in town, and they don't like it," says Jim Gilbert, president of 401(k) Pro Inc., which markets a plan called 401(k) Easy. But even if the startups were to fail, that would be more inconvenient than dangerous. Your plan's assets would still be safely invested in registered mutual funds. Given that these providers have state-of-the-art systems, your plan's records should be in good condition and easily transferable to another vendor...."

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