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Most Popular FiduciaryNews.com Stories in 2012 – #10 to #6

December 26
00:03 2012

First and foremost, we hope everyone had a thoroughly enjoyable and restful Christmas. We continue this week identifying the most widely read FiduciaryNews.com stories in 2012. Why is this an important exercise? Because readers who know what other readers are reading, know what other readers are thinking. If you want to be considered a thought leader, or excel as a plan provider, vendor or regulator, then that’s an important thing. Here we go with stories #10 through #6. Next week: The top five.

#10 “Ex-Employees Who Don’t Rollover – Will 401k Fees Increase Plan Sponsor Liability?” (June 28, 2011) Here’s a lingering issue that particularly gnaws as plan sponsors like a festering wound. What should they do about ex-employees? “Should they stay or should they go?” It used to be regular folk (including plan sponsors) thought the great protector of ERISA would provide benefits to former employers. Financial professionals, though, have long recognized the need to “get the money out” of the clutches of the former employer and the costly regulatory infrastructure. In this article, industry veterans explain the issues and benefits of rolling retirement funds out of former employees’ plans. Besides greater control, the investor can probably get better returns even when investing in the same funds just through the elimination of the administrative fees.

#9 “A 401k Must Read: Mutual Fund Expense Ratio Myth Busted,” (October 9, 2012) Lower expense ratios mean better mutual fund returns, right? Well, yes and no. If you’re talking about index funds, then yes. If you’re talking about actively managed funds, then no. Sorry to burst your bubble, but the bottom-line is the contention that the mutual fund expense ratio has a bearing on investment performance is a myth. Read it and weep. The article contains graphs for those who are more convinced by pictures. The “man bites dog” nature of this story may explain why, so late in the year, it still makes the top ten list.

#8 “Benchmarking: The Key to a 401k Plan Sponsor’s Fiduciary Compliance Review” (January 24, 2012) This is the first of a three a part series on reviewing a 401k plan. These types of “how-to” articles have always been popular. This article outlines five critical areas of review. Any of these areas can reveal unexpected cracks in the foundation of a plan.

#7 “The Best Way 401k Plan Sponsors Can Benchmark Their Plans,” (January 26, 2012) They say things are best when they come in threes. This was the final installment of the above article’s three-part series. This one probably was read more because this article provided some real, reliable and independent sources of 401k benchmarking data.

#6 “7 Low or No-Cost Ways to Increase 401k Participation,” (July 17, 2012) In reviewing the top stories for 2012, it appears we’ve featured a number of myth-busting articles, including the mutual fund expense ratio story listed above and the asset allocation piece in last week’s honorable mentions. Here’s one that presents some good news while piercing a popular myth. It turns out matching, while providing a modest incentive, isn’t the cheapest and most effective way to get encourage employees to save more in their 401k plans.

Come back the day after New Year’s to discover the top 5 stories of 2012. In the meantime, don’t forget to take a look at 401k Fiduciary Solutions, a book written by Chief Contributing Editor Christopher Carosa and published by our parent company, Pandamensional Solutions, Inc. It’s the perfect training manual for your employees and clients.

In the meantime, have a safe and joyous New Year!

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Christopher Carosa, CTFA

Christopher Carosa, CTFA

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