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Most Popular FiduciaryNews.com Stories in 2013 – #10 to #6

December 26
00:48 2013

Happy Boxing Day, everyone. We hope all those celebrants had a wonderful Christmas and we welcome you back to our year-end countdown of the most widely-read articles in FiduciaryNews.com during 2013. As we indicated in our 1214646_98207928_gift_box_stock_xchng_royalty_free_300opening installment in this series (“Most Widely Read FiduciaryNews.com Stories in 2013 – Honorable Mention,” FiduciaryNews.com, December 24, 2014), this year’s list contains several articles that are quickly earning “evergreen” status. We’ll see them on this portion of the list. Remember, if you want to be considered on the leading edge of your industry, it’s important to know both what your peers are reading and why they’re reading it. The numbers below tell you the what. Our usual blunt analysis tells you the why. Here we go with stories #10 through #6. Next week: The top five.

#10 “What’s a Fair Fee to Pay a Fiduciary?” (October 2, 2012) Coming in at the bottom of our top ten most widely read stories is one that first appeared more than a year ago – and as the climax to our special 6-part series on “Fiduciary September” that year. While this piece tends to be more conceptual, it represents a harbinger of things to come (you’ll have to wait for the final installment of this series to discover that answer). Still, in the short time since the introduction of the 401k Fee Disclosure Rule, this particular question – whether pertaining to the plan fiduciary, its recordkeeper or any other service provider – regarding “What’s a fair fee?” remained prominent in the minds of plan sponsors. For those you haven’t read this article (and perhaps why you should), the answer is often not as easy as it seems.

#9 “DOL Smacks 401k Adviser for 12b-1 Fiduciary Breach. Plan Sponsors Next,” (March 26, 2013) Travelling the country and speaking to various 401k fiduciaries and plan sponsors, there’s often the lament “Why should 401k plan sponsors care about their fiduciary liability if the DOL never holds their feet to the fire?” This story addressed that question in quite dramatic fashion. (And by “dramatic” we’re referring to all seven figures of drama.) More importantly, this DOL’s action in this case was consistent with everything we had been writing about for some time. Namely, the existence of 12b-1 fees in 401k plans really puts the plan sponsor at risk. It certainly did in this case. What makes this precedent all the more scarier is that the circumstances were not too different from many other plans, meaning even the average 401k plan sponsor has something real to worry about.

#8 “Morningstar Star Ratings: Do They or Don’t They Predict?” (January 29, 2013) This story continues a line of argument we started a few weeks earlier when we ran “Have Mutual Fund Rating Agencies Lost Their Mojo?” (FiduciaryNews.com, January 14, 2013). Morningstar didn’t take too kindly to this perceived slap and their public affairs department responded. We gave them a chance to “clarify” and that resulted in this story. To be honest, we didn’t think it changed anything, but it did make us and Morningstar feel better. Of greater significance, it gave our readers more succinct information on the matter. That same lucidity may been what attracted The Huffington Post to cite this article in one of their own stories.

#7 “Anticipating the Bond Bubble Burst: Protecting Your 401k Plan,” (March 19, 2013) To be honest, we’ve been running stories like this every now and then since our inception in 2009. It’s not rocket science. Everyone knows with record low interest rates, any pick-up in the economy that leads to a boost in borrowing rates will have a negative impact on the price of bonds. What makes this article different is both its depth (it’s longer than average in length) and timeliness. Within a few weeks of publication, the precise scenario of rising interest rates (in the form of the much anticipated taper) appeared to be occurring. Of course, this freaked all the markets and Bernanke had to testify on the Hill to calm things down. Without a doubt, the article does foreshadow life as we will “soon” know it. Again, it’s not rocket science to know that. Knowing what “soon” means, though, represents another thing all together.

#6 “A 401k Must Read: Mutual Fund Expense Ratio Myth Busted,” (October 9, 2012) Quite frankly, the position of this article on the most widely read list surprises even us. This is our third article published in 2012 (included the Honorable Mentions from earlier) to appear on this years’ list. First, a bit of analytics. This article scored high in part because of the flurry of new readers we received in the last twelve months. Second, about the content. No one expects this myth to be busted, and certainly not in the convincing manner (which includes easy-t-read graphs) presented in this article. Finally, since the infamous NPR Frontline episode relied heavily on this myth to support its thesis, this article became a ready (and more than able) counterpoint to easily reture the claims presented in the show. If you have read this article, you must. But be careful. Read it for what it doesn’t say just as much as you read it for what it does say.

With that hint as to what might be in remaining stories on 2013 list of most widely read FiduciaryNews.com articles, we’ll ask you to return New Year’s Eve day to discover the top 5 stories of 2013. If you like the stories you’ve read to date, please 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 year-end rush!

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Christopher Carosa, CTFA

Christopher Carosa, CTFA

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