Investing in equity and hybrid mutual funds through 401(k) plans became less costly in 2018 while the average expense ratio of bond mutual funds remained stable, the Investment Company Institute, a trade group for the fund industry, reported last week.
Plan participants who invest in mutual funds in their 401(k)s tend to hold lower-cost funds, the report showed.
"In this vibrant marketplace, funds compete to provide cost-effective and diversified investment options for investors," Sarah Holden, ICI's senior director of retirement and investor research, said in a statement.
"Mutual funds represent the majority of assets held in 401(k) plans and the continuing decline in fees greatly benefits 401(k) plan participants building their retirement nest eggs. Both plan sponsors and investors pay close attention to fees and fuel the competitive pressure to bring them down."