More taxing threats, defining fiduciary down and the failure of fee disclosure.
Will retirees pay for Washington’s fiscal mismanagement? Has pinning the fiduciary onus on plan sponsors been the wrong approach all along? And more…
The major media tries to say something on the industry and falls flat. Meanwhile, the industry journalists write about things that matter, but only insiders read.
Contrary to popular press reports, economic theory clearly suggests paying high fees is justified. Here’s the cruel irony and the greatest danger posed by the myth of high mutual fund fees: by taking back some of the responsibility normally delegated to professional advisers, an active fiduciary may in reality take on a greater fiduciary liability.
Investors have decided to flee two asset classes: stocks, perhaps because of their dramatic gains in the last six months; and cash, perhaps because of historically low interest rates. In either case, investors have signaled their lack of confidence in a near term recovery in the American economy.
Unless and until we can break the momentum of intertwined conflicts-of-interest, the greatest legacy we’ll leave our grandchildren’s children may be an outstanding bill to pay for spiraling public employee retirement benefits.
Diversification does not protect the investor when the entire asset class sinks. A recent study from Hewitt Associates suggests events may be placing plan fiduciaries in a historically precarious position.
Mutual fund shareholders can’t have their cake and eat it, too. Indeed, a myth busting professor bluntly states “mandatory fee reductions are likely to injure fund shareholders.”
We don’t need more regulation to prevent future Madoffs, we just need common sense (and, perhaps, a tad bit more enforcement of existing regulations). Here are five straightforward rules fiduciaries can follow to avoid their own personal investment Waterloo.
You may be an ERISA/401k fiduciary and not know it. The first step to reducing your personal fiduciary liability it to fully understand under what conditions you may be acting as a fiduciary.