The good news regarding mutual and exchange-traded fund fees? Last year saw the biggest one-year decline in fees and several major fund companies have been competitively lowering their fees (with one now even offering index funds without any management fees). The bad news, according to today’s article, “is that many investors don’t realize how much they’re paying in fund fees in the first place or how much these expenses and other investment costs are eating into their retirement savings.” How much can seemingly small fees deplete your retirement savings – and how can you minimize their bite? CLICK HERE.
The author of today’s article argues that the investments in your retirement account are likely not as diversified as they should be. Rather than the traditional approach to diversification (a mix of stocks, bonds and mutual funds), the author advocates “extended diversification”, which “requires a different set of resources than the traditional investment approach.” For more on how you can supercharge your retirement savings through extended diversification – including one particular asset class the author suggests considering – CLICK HERE.
There are over 8,000 mutual funds and the average participant in a workplace retirement plan has 28 investment options to choose from. However, the author of today’s article advises that “you can create a smart, diversified portfolio with just a handful of mutual funds” – and she proceeds to highlight some model “lazy portfolios” to do just that. To learn about the Margarita Portfolio, the No-Brainer Portfolio and more – as well as the past performance of these portfolios – CLICK HERE.
While the primary casualty of the fiduciary rule – which began to take effect in June – is intended to be conflicts of interest on the part of financial advisers when it comes to their clients’ retirement accounts, today’s article identifies another potential casualty of the rule: the number of mutual funds offered by brokerage firms as they seek to comply with the rule. While advocates of the fiduciary rule claim that investors will benefit from this pruning of funds, others are concerned about the implications of this “less is more” approach. To read more, CLICK HERE.
One of the macro-level changes in the investment landscape has been the large-scale shift by investors into indexes and ETFs (and away from stocks and mutual funds) – a shift that the author of today’s article sees as being based on misplaced beliefs, and one that he warns will cost those investors – especially younger investors – in the long run through “meek unassuming gains.” He instead advocates using a three-pronged portfolio (Core, Explore and Super Explore) that offers “diversification, index-beating growth, and fee minimization.” To read more, CLICK HERE.
In this case a race to the bottom is a good thing: In an effort to attract new customers and increase market share in an extremely competitive business, mutual fund companies are battling it out for who can offer the lowest-cost ETF – and the resultant rock-bottom fees are great news for retirement savers. The author of today’s article highlights some of the cheapest funds available and provides advice on how to use them effectively in a portfolio. To read more, CLICK HERE.
They’re not likely to help you become rich, but they can help you maintain your purchasing power. Today’s article provides an examination of TIPS (treasury inflation-protected securities), a form of U.S. Treasury bond which serves as an investment option for those who are worried about their money losing its purchasing power due to inflation (such as investors who are in or approaching retirement). To read more about the pros (e.g. the two ways in which they pay off) and cons (e.g. their “irksome” tax issues) of TIPS – as well as why the best way to invest in TIPS may be through mutual funds or exchange-traded funds – CLICK HERE.
There have been a mounting number of class-action lawsuits of late over the retirement savings plans offered by corporations and institutions such as universities. Against this backdrop, today’s article examines some of the main allegations at the heart of many of these lawsuits, thus identifying ways in which plan sponsors can shortchange retirement savers in general. From excessive fees, to offering too much choice, to financial companies “self-dealing” their own (poor) mutual funds, CLICK HERE to read more about what is driving this deluge of lawsuits – and what all retirement plan participants need to be cognizant of.
“Even if you were an incredibly well-informed investor and paid a great deal of attention, it’s very hard to succeed in this system.” This is the assessment of law professor William A. Birdthistle, who has penned a new book on the perceived failures of the United States’ do-it-yourself retirement system, specifically mutual funds and 401(k)s. To read what Birdthistle sees as the problems with funds and 401(k)s, what he considers to be a “perverse” system of fees, and why he believes that employees should be required to get licenses before being able to invest in their 401(k)s – as well as his thoughts on exchange-traded funds, target-date funds and more – CLICK HERE to read today’s article, which features a comprehensive interview with him.