NEPC, LLC published the results of its 11th Annual NEPC Defined Contribution Plan and Fee Survey. Data shows that Defined Contribution (DC) plan record-keeping and investment management fees continue to decline.

According to the survey, the asset-weighted average expense ratio for DC plans is currently 0.42% versus the 2006 level of 0.57% when the first survey was conducted.

Some will say that this indicative of a race to the bottom for plan fees, but the survey isn’t that crystal clear. That 0.57% number was at a time when there was no fee disclosure regulation. It’s also at a time when plan assets are lower as this fee survey shows fees in relationship to plan assets. It’s also at a time when technology wasn’t as dynamic as it is now. We also know that fee disclosure regulation was going to have an impact on fees because fee transparency was going to spur competition on fees.

Time will tell whether fee disclosure and the new fiduciary rule will spur a race to zero, but the narrowing on fees can also be chalked up to lower costs because of better technology and a growth of DC plan assets.