Companies say the suits are without merit, but consumer advocates and benefits experts say that increased attention to fees is a good thing.

It's a safe bet that many workers don't know how much they are paying on their 401(k)'s. Even some employers are in the dark, relying on outside experts to handle the details.

Workers with sharp eyes and a calculator can generally figure out what they pay by going through the prospectus and quarterly statement, but they will have little luck uncovering some of the arrangements that could affect their nest eggs.

But so many financial futures now are riding on these retirement accounts, with traditional pensions rapidly disappearing, so fees and expenses matter.

"Even if the lawsuits amount to nothing ... this is kind of a wake-up call for plan sponsors that they need to be paying more attention to fees and expenses," said Gregory Ash, a benefits lawyer with Spencer Fane Britt & Browne.

It's no easy task for workers to decipher the cost of a 401(k). There are enough kinds of fees to make the most conscientious investor's head spin.

No fee standard

Workers are entitled to know the fees they pay, experts say. And for those investing in mutual funds, the biggest expense will be related to the fund's money management. This is spelled out in the prospectus.

Administrative costs--often borne by workers--are harder to pin down.

Taken together, workers pay 0.50 percent to about 2 percent a year for investment management and administrative-related services, said David Huntley, a principal with HR Investment Consultants in Towson, Md. Smaller plans tend to be on the high end.

To put fees in perspective, consider a worker with the average account balance of $60,000. The worker could pay $300 to about $1,200 a year in fees.

"There is no standard. It's all over the place," said Edward Lynch Jr., a benefits expert with Dietz & Lynch Financial Strategies Group of Wachovia Securities, a retirement plan consultant in Massachusetts.

Some mutual fund companies, for instance, will charge little or no fee for administering a 401(k) if their mutual funds are in the plan. They make money on fund management fees.

Some administrators or record-keepers will take a percentage of the assets in the plan. Workers see their account balance after the fee is taken out, experts said.

Administrators and other service providers also may be compensated by revenue sharing. A fund company, for instance, will share some of the money it makes with an administrator for keeping track of workers' accounts or undertaking other tasks on the company's behalf.

Revenue sharing could be a good thing if it is fully disclosed and reduces costs for workers, Lynch said. But it can be a problem if it influences the decisions on which mutual funds end up in the 401(k), he said.

The 10 employee lawsuits, all filed since September, target a variety of expenses.

Some employer advocates say the lawsuits' targets are big companies that typically have the clout to negotiate low fees and hire outside professionals to construct the best plans possible.

"We do know that in general large companies have very low fees," even lower than investors could get on their own outside the plan, said David Wray, president of the Profit Sharing/401(k) Council of America, which represents employers.

Government to step in

Improved fee disclosure may be coming.

The Department of Labor, for instance, is proposing greater fee disclosure beginning in 2009 on an annual document that employers file with government on their 401(k) and pension plans.

Ultimately, the focus on 401(k) costs will drive up competition among service providers and drive down fees, similar to what happened with mutual fund fees, said Rick Meigs, president of 401kHelpCenter.com.

But what can employees do in the meantime? The first step is talk to your employer, benefits experts say.

Ask about fees that you pay, even indirectly, for administration and record-keeping, said Susan Mangiero, an investment fiduciary analyst and founder of Pension Governance in Connecticut. Ask, too, about the process the employer took to determine which investments went into the plan. "How often does that process get vetted?" Mangiero said.

Benefits lawyer Ash said workers should drill down enough to make sure their employer hasn't overlooked any hidden fees. "As participants, you want an explanation," Ash said.

Barbara Roper, director of investor protection for the Consumer Federation of America, said these types of questions are critical with so many people relying on their 401(k)'s for retirement.

"This is the primary way that Americans participate in the securities market," she said. "It's important to get it right."

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