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More and more Digital Realty Trust employees are investing in their futures through 401(k) plans. Digital Realty Trust employees who participate in 401(k) plans assume responsibility for their retirement income by contributing part of their salary and, in many instances, by directing their own investments.
As a Digital Realty Trust employee, if you are among those who direct your investments, you will need to consider the investment objectives, the risk and return characteristics, and the performance over time of each investment option offered by your plan. Fees and expenses are one of the factors that will affect your investment returns and will impact your retirement income. This article will outline some of the major factors that may impact the severity of fees relating to your Digital Realty Trust 401(k) plan:
'Fees and expenses are one of the factors that will affect your investment returns and will impact your retirement income.' |
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Funds that are “actively managed” (i.e., funds with an investment adviser who continually researches, monitors, and actively trades the holdings of the fund to seek a higher return than the market) generally have higher fees. The higher fees are associated with the more active management provided and sales charges from the higher level of trading activity. As a Digital Realty Trust employee, you may want to consider how while actively managed funds seek to provide higher returns than the market, neither active management nor higher fees necessarily guarantee higher returns.
Funds that are “passively managed” generally have lower management fees. Passively managed funds seek to obtain the investment results of an established market index, such as the Standard and Poor’s 500, by duplicating the holdings included in the index. Thus, passively managed funds require little research or trading activity. For Digital Realty Trust employees, it is worthy to account for the information when deciding who will manage your funds, and if their rates are adequate for the services provided.
If the services and investment options under your plan as a Digital Realty Trust employee are offered through a bundled program, then some or all of the costs of plan services may not be separately charged to the plan or to your employer. For example, these costs possibly may be subsidized by the asset-based fees charged on investments. Compare the services received in light of the total fees paid.
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Plans with more total assets may be able to lower fees by using special funds or classes of stock in funds, which generally are sold to larger group investors. “Retail” or “brand name” funds, which are also marketed to individual and small group investors, tend to be listed in the newspaper daily and typically charge higher fees. As a Digital Realty Trust employee, you should inform your employer of your preference.
Optional features, such as participant loan programs and insurance benefits offered under variable annuity contracts, involve additional costs. Consider whether they have value to you as a Digital Realty Trust employee. If not, let your employer know.
Retirement plans, such as 401(k) plans, are group plans. For those working in Digital Realty Trust, your employer may not be able to accommodate each employee’s preferences for investment options or additional services.
What type of retirement savings plan does Digital Realty Trust offer to its employees?
Digital Realty Trust offers a 401(k) retirement savings plan to its employees.
Does Digital Realty Trust match employee contributions to the 401(k) plan?
Yes, Digital Realty Trust provides a matching contribution to employee 401(k) contributions, subject to certain limits.
What is the eligibility requirement for employees to participate in the Digital Realty Trust 401(k) plan?
Employees of Digital Realty Trust are eligible to participate in the 401(k) plan after completing a specified period of service.
Can employees of Digital Realty Trust choose how their 401(k) contributions are invested?
Yes, employees of Digital Realty Trust can select from a variety of investment options for their 401(k) contributions.
What is the maximum contribution limit for the Digital Realty Trust 401(k) plan?
The maximum contribution limit for the Digital Realty Trust 401(k) plan aligns with the IRS limits, which may change annually.
Does Digital Realty Trust offer a Roth 401(k) option?
Yes, Digital Realty Trust offers a Roth 401(k) option, allowing employees to make after-tax contributions.
What happens to my 401(k) account if I leave Digital Realty Trust?
If you leave Digital Realty Trust, you can either roll over your 401(k) balance to another retirement account or leave it in the Digital Realty Trust plan, subject to the plan's rules.
Are there any fees associated with the Digital Realty Trust 401(k) plan?
Yes, there may be administrative fees associated with the Digital Realty Trust 401(k) plan, which are disclosed in the plan documents.
How often can employees change their contribution amounts in the Digital Realty Trust 401(k) plan?
Employees of Digital Realty Trust can change their contribution amounts at designated times throughout the year, as outlined in the plan guidelines.
Does Digital Realty Trust provide educational resources for employees regarding their 401(k) plan?
Yes, Digital Realty Trust offers educational resources and tools to help employees understand their 401(k) plan options and investment choices.