Schwab Retirement Plan Services has launched a full-service 401(k) program based on low-cost exchange-traded funds (ETFs).
“We believe workers can and should get more value from their 401(k)s,” says Steve Anderson, head of Schwab Retirement Plan Services.
He estimates that a 401(k) plan using index ETFs can reduce investment expenses by more than 90% compared with a typical 401(k) plan that primarily uses actively managed mutual funds, and by more than 30% compared with a 401(k) plan that uses index mutual funds.
The program allows commission-free intraday investing, along with the ability to process partial share interests. It also offers an optional low-cost personalized savings and investment strategy through independent third-party advisory services.
Employers and their retirement plan consultants can build a diversified investment fund lineup, choosing from roughly 80 low-cost index ETFs that Schwab makes available under the platform.