Can 401k plans offer etfs?

Offering ETFs on Your 401k Plan The biggest benefit of an ETF in a 401k plan is its generally low expenses compared to offers based on mutual funds or insurance. Many ETFs offer tax efficiency due to their structure. This is not a relevant feature in a tax-deferred retirement plan, such as a 401 (k) plan. ETFs are similar to mutual funds.

If your 401 (k) options include an ETF (or any investment fund) that you consider a good option, there is no reason not to choose it. But it's possible to invest in ETFs on your 401 (k), and some providers have made progress over the past five years. Skrobe says there is definitely a place for ETFs in retirement plans. Plan sponsors are consolidating their investment menus to reduce costs, which should be of concern to DC investment managers.

The 401,000 world seems interested in making changes next year in investment options in several investment plans, according to a study by Cogent Research.