<prompt> Human: A month ago Ive got serious about the fund allocations in my 401k, so I went through them and decided to go with two Vanguard funds, VEXAX and VTMGX According to Morningstar, they have expense ratios of .09 and I thought I was all set. Then John Olivers piece on 401k fees made me revisit my 401k user portal I have Securian and just double check everything. Lo and behold, after some digging around, I found a document called Participant fee and investment notice and it shows that those two funds actually have an expense ratio of .7. I emailed HR and they confirmed the fees and told me that those .09 expense ratios are for personal accounts. They also said since this is 401k there are additional fee wrapped in the expense ration and if I were to choose a personal plan, the limits of contribution would be much less and there would operational fees that I would have to pay personally. Is it normal to see bloated expense ratios like these in 401ks? How about those personal operation fees? My company doesnt even offer any matching so Im thinking of just opening a Roth IRA with vanguard but not sure what fees they charge. Thanks in advance!  <response>: Wrap fees are a common way to pay for 401k plan expenses, and 0.61 0.70-0.09 is not the worst wrap fee Ive ever seen. Is it fair? It mainly depends on the size of your plan, but in all likelihood, probably not.The cost of running a 401k plan usually involves two separate components: the cost of the plans core components, and a per-employee cost for recordkeeping. The former part can cost as little as 1500 per year, and the latter usually costs 30-60 per year per employee, depending on the plan size larger plans usually cost less per employee due to economy of scale.Actually paying these plan expenses can be done in countless ways. Your employer has chosen to pay for expenses by adding a wrap fee around all plan menu options, instead of charging out flat fees to all participants, or by simply paying for plan expenses out of the companys pocket.With that said, it doesnt take a lot of assets within a 401k plan to make a 0.61 fee outpace the actual cost of running the plan. Assuming a plan has 100 employees and 5MM in assets, the cost from a low-cost provider like Employee Fiduciary would put the cost around 7,600 per year, or about 76 per employee. A 0.61 wrap fee, on the other hand, would cost around 30,500, or 305 per employee. 