If the head of the investment arm of one of the nation’s largest banks can’t tell you why he thinks a broker is better than a registered investment advisor or why actively managed is better than an index funds, let’s stop blaming the Frontline reporter for a biased report.
There needs to be some sort of standard where a financial advisor doesn’t get a bigger trail by pushing a specific fund. There needs to be a simple disclosure of all plan expenses and fees just like the menu at In N Out. The biggest shame about the program is that the biggest problem in the 401(k) plan business isn’t the mutual fund companies; it’s the lack of any good investment education and/or advice for plan participants. The biggest problem affecting 401(k) plan is that it put the investment decisions in the hands of the people who have the least amount of background or sophistication to make those decisions, the plan participant. While the Frontline program seemed to have a bias for index investing, I am convinced that an all index lineup on a plan menu will do little good for plan participants who have no idea how to invest. Only until just recently, did the Department of Labor allow plan providers to offer investment advice and only a few providers will offer it because of the hurdles that the Labor Department put in place for providers to jump over in offering advice.
Read entire Rosenbaum Blog:
http://therosenbaumlawfirm.com/blog/?p=1362&goback=%2Egde_2501193_member_235925882