Fiduciaries of very large plans who wouldn’t think of not haggling with a dealer over the price of a new car or a hotly negotiating a business deal have sometimes neglected to leverage their plan’s size to negotiate lower 401(k) fees. The result is a sharply increased risk of being sued.

A few years ago, Wal-Mart entered into an expensive settlement of a lawsuit challenging its use of retail mutual funds in its 401(k) plan and requiring changes in its fiduciary practices. One of the contentions in the suit was that Wal-Mart’s fiduciaries didn’t use the plan’s size to invest in institutional class funds that made the same investments with lower fees than the retail funds Wal-Mart made available to participants. (Only large investors are eligible to invest in institutional class finds.)

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