Amid the increased focus on the costs of 401(k) plans, Prudential Investments has launched a share class, Q Shares, designed for retirement plans. Prudential will not charge 12b-1 fees on Q Shares, and says the shares will involve only minimal transfer agency fees.
"Plan sponsors are looking for a way to get more transparency on the fees they pay on all the services provided in their retirement plan," says Michael Rosenberg, senior vice president and head of Prudential's investment only defined contribution group. "This is certainly in response to that."
Plans eligible to use Q Shares include 401(k)s, 403(b)s, Keoghs, profit-sharing pension plans and Simple IRA plans, the company says. Plans that currently invest in another share class of a Prudential fund can convert to Class Q shares.
"The overriding thought here is we want to offer flexibility," says Rosenberg. "It's not just the lowest-price-possible investment alternative, it's putting together the right plan for the plan sponsor and their participants."