No. of Recommendations: 3

You wrote, I moved about half my 401k into a brokerage account within the 401k. The fee is, IIRC, 0.025% per year, assessed quarterly. The commissions are $7.95 for some things, 0 for others (buy mutual funds that are "in the family" of the administering company). For the $7.95 times two (once to buy and, eventually again to sell), I have some ETFs whose fees are like 0.15%. All told, I'm saving money on fees compared to the 1% and even 0.3% on the mutual funds within the "regular" 401k choices.

I'm happy with a couple of the "regular" 401k choices. Also, it's useful for the semi-monthly deposit. You could kill yourself paying a brokerage commission twice a month time four or so funds each time.

I'm sure my own employer is probably paying something similar on my behalf so we can use the brokerage window without an extra charge.

As for your second point about semi-monthly contributions, I had a similar concern when I had a brokerage option. My 401(k) is at Fidelity. They have a list of commission-free ETFs, which I've confirmed are still commissions free in our brokerage window. Does your 401(k)'s broker have anything similar? Given the commission your broker charges ($7.95), I have to wonder if you're not also at Fidelity...

- Joel
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