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I suspect 403(b) participants have an easier time getting their employers to do the right thing, as compared to 401(k) participants.
What we need is an ombudsman service, where we can legally provide all the information about our 401(k), and then have the service come down hard on the employer, with some teeth to their authority, to force them to do the right thing. But we don't have a right to expect that, and it isn't forthcoming, and things are going to actually get worse (for the reasons I mentioned earlier).
To the contrary. I have been following this for years and public employees are more likely to get screwed for some of the following reasons.
Local politics
Cost control and public scrutiny
Local politics
The ability of local investment companies to pressure local government to allow them to provide
Local politics
The ease of insurance companies to lobby and pressure the writing of regulations which did happen at the federal level and gave insurance companies a major advantage.
If a company provides a source of investing for your retirement do they become responsible for your financial education?
I don't have an answer.
NOOOOOOOOOOOOOOOOO and absolutely no. Would they be creating a fiduciary or legal responsibility for your plan failing? Especially in the public sector they won't tell you squat other than here are the forms. Does anyone think after the meltdown and with they way brokers are being blamed and sued by individuals any employer wants that legal risk? They provide seminars and have outside folks come in often the ones representing the companies in the plan.
I agree , but even if they straightned out the fees and offerings on the employer end the fact is still left to their own devices the public will still fail .
They just have no interest in learning for the most part.
Morningstar small investor return tracking already proved that fact.
A question to MathJak since you indicated you were involved in your company's 401K selection process. Is there a financial incentive for a company to choose one fund family over another? Does the company get something from the provider of the funds? Just curious, as it's hard for me to understand why there are so many poor choices out there.
I agree , but even if they straightned out the fees and offerings on the employer end the fact is still left to their own devices the public will still fail .
Maybe, maybe not. At least then the criticisms of the general public in this thread would be legitimate.
K-14 educators in California are saddled with arcane insurance code 770.3 written in 1969 that prohibits competitive bidding in 403(b) plans. This has led to lengthy vendor lists often dominated by high fee insurance products. Assembly Bill 1949, introduced on February 24, 2012, would allow K-14 agencies to select a minimum of four vendors through a competitive bidding process. Past reform efforts have been vigorously opposed by entrenched interests. Update: CTA + UTLA + financial firms team up to defeat legislation.
A number of the people featured in the show were teachers
A question to MathJak since you indicated you were involved in your company's 401K selection process. Is there a financial incentive for a company to choose one fund family over another? Does the company get something from the provider of the funds? Just curious, as it's hard for me to understand why there are so many poor choices out there.
there was nothing in it for the company. we went with the best choices in providors we could think of.
i would not even guess at the answer as i can not speak for anyone other than those i know.
the media always likes to present a case of the sky is falling and for some it may be true. but certainly it can be true that it is not falling for even more.
NOOOOOOOOOOOOOOOOO and absolutely no. Would they be creating a fiduciary or legal responsibility for your plan failing? Especially in the public sector they won't tell you squat other than here are the forms. Does anyone think after the meltdown and with they way brokers are being blamed and sued by individuals any employer wants that legal risk? They provide seminars and have outside folks come in often the ones representing the companies in the plan.
my opinion is no way would we take on that responsibility but that is exactly what quite a few were expecting from their companies so they did not have to bother to learn. .
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