Since the Ninth Circuit Court ruled against having A, B, and C class mutual funds included in 401(k) plans, why should we ever own these retail priced funds?
http://www.401kfiduciarynews.com/erisa-ninth-circuit-rules-that-fiduciaries-who-included-retail-class-mutual-funds-in-a-401k-plans-investment-menu-were-imprudent-for-not-considering-the-inclusion-of-institutional-share-class-alteWhy bad funds stay in your 401(k)
When you are dealing with actively managed mutual funds you will always have some bad funds in your portfolio. The thought that someone can predict which fund managers will beat the market seems attractive. The problem is the Wall Street bullies have convinced you that it can be done when in fact it cannot. The markets are random and unpredictable. You should invest accordingly, with the help of an investor coach.
http://www.401kfiduciarynews.com/why-bad-funds-stay-in-your-401kWhy 401(k) plans & Mutual Funds are undermining investors’ financial security
“No one thought this out. The 401(k) plans were originally introduced as supplemental plans only. No one ever said, “Oh, let’s end traditional pensions and replace them with 401(k) plans.”
“Much of the push toward 401(k)s was not driven by ordinary workers. It was driven by CEOs looking for tax protection in order to maximize the value of their retirements. … If you read the legislative history…of the 401(k), it’s clear this was a tax break for the folks who made lots and lots of money. …That’s the irony. What it was designed for and what it’s being put to use for are totally different from each other.”
“Are you saying a storm is coming? A perfect legal storm is approaching…workers are going to retire into despair and run out of money. … They played the game (401K); they were faithful, loyal employees. They are old and gray and broke.”
“I agree with Mr. Bogle. … Fees can eat up a lot of your gains. …Employees have more money than they would have if they didn’t save at all, but certainly they’re not in as advantageous a position as someone who can have an S&P [Standard & Poor’s] 500 index fund.”
“Investors should realize [they] don’t get the market return. … So if I do your average, what percentage of your net growth is going to fees in a 401(k) plan?”
http://www.illuminwealth.com/Challenges/FRONTLINE.pdf