Fiduciary News

How do we stop the BHB myth that claims asset allocation accounts for 93% of investment performance? It’s been a while since major financial service providers have misquoted the infamous Brinson-Hood-Beebower research papers from the late 1980s/early 1990s. We still, however, see individual practitioners and even the some journalists repeating t…[Read more]

Why do you think Target Risk Funds contain less fiduciary liability concerns for 401k plan sponsors than Target Date Funds? Target Date Funds have exploded in terms of popularity. It’s not that they’re proven in any sense of the word. In fact, the economic crash of 2008/2009 exposed their true nature and the potential liability they pose. The…[Read more]

Cross Trading Can Harm Investment Performance. Here’s an article that explains it. Were you aware of it and the implications?
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New 401k Plan Sponsor F…[Read more]

What’s the best way to improve 401k participant fee disclosure? While it may be correct that it does more harm than good, it’s not going away. Our only hope is to make it better.How do you see that happening? Is there something more important than fees to disclose to 401k plan participants?
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When it comes to retirement plans, what is more important than fees? As David Huntley, co-editor of the 401k Averages Book explains in the attached article, fees are the be-all and end-all when it comes to value. The DOL apparently shares this opinion. In your mind, what’s more important than fees?
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Why a Fee Disclosure? It’s just not working. In fact, does it have any meaning at all, other than to confuse plan participants? It’s one thing to place the burden of discerning the value of fees on the plan sponsor for, after all, that is their fiduciary duty. But why bring the plan participant in it? It’s not like they can do anything about it.
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How do you solve a problem like revenue sharing? Should revenue sharing stay or should it go? It’s the cousin of the infamous 12b-1, long out of favor and now a target of the SEC. Is there really any difference between revenue sharing or 12b-1? And, if not, then why shouldn’t they be treated the same?
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For almost two years now, I have been expressing my frustration about the “Fiduciary” standard because I knew that the lobbying effort during the rules making process leading up to the proposed regulation would be intense and would be ruled by those with the most to lose. I could not believe that people on our side supported the idea.

I pos…[Read more]

Has the DOL sufficiently defined “best interests” under its new proposal? Or are we going to have to wait for the courts to decide? The DOL is saying let the courts decide. Is that really in the best interests of, well, anyone?
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What’s the biggest impediment to saving for retirement? You may be surprised to see what AARP’s David Certner has to say in the attached article. Before you read it, though, tell us what you think it is.
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The Evolution of 401k Benchmarks – what are your ideas? How we pick 401k benchmarks have changed over the years. What guidelines to select benchmarks do you use today that you didn’t use 10-15 years ago? Can’t remember that far back?
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How can gamification improve employee communications? This has the potential to create the next wave in 401k enhancements. How do you envision game-like techniques being used to motivate employees to save more for retirement?
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Are financial professionals speaking the same language as plan participants? Here’s an interesting article whose title poses a great question. What do you think?
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How do you see Behavioral Economics changing the way today’s 401k plans are designed? Many feel the style box unnecessarily complicated 401k plan menus. Research in behavioral economics has shown us a way out (as the article details). How do you see 401k plan menu options changing now that the style box method has lost favor?
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From a tax standpoint, Are people better or worse off investing in a 401k plan? Lately, there’s been much discussion surrounding the tax benefits of 401k plans. Many say, with tax rates so low, there’s no reason to invest in a 401k or any other tax deferred savings plan. Tell us what you think below. In either case, you might be surprised by the…[Read more]

If you want someone to do you a favor, you must first do them a favor. That’s one of the big lessons taught by Professor Don Corleone. (And when that doesn’t work, there’s always “that” offer.) Trouble is, sometimes people ask for one thing and want another. Other times they ask for something they shouldn’t have. But what if they never ask? That’s…[Read more]