In my weekend reading, I saw a news feed from the 401kSpecialist web site that summarized a new company 401(k) study. Here is a link to the article.
The study from Phoenix Marketing International revealed that over 40 percent of company 401(k) retirement plan participants are not provided, or don’t know if they are provided, with investment performance information from their company 401(k) provider.
The real surprise for me was the revelation that individual company 401(k) retirement plan participants don’t believe that they receive reliable investment performance information.
How can you be confident where your company 401(k) retirement plan money is invested if you don’t trust the investment performance numbers?
Even worse, if the investment performance numbers are not accurate, how can you rank your company 401(k) retirement plan mutual fund options?
No individual investor can gain the confidence to make company 401(k) retirement plan investment management decisions in an environment that lacks trust in the information provided to them.
Individual company 401(k) retirement plan participants perceive a conflict of interest with their company 401(k) retirement plan advisors and providers. This conflict of interest was to be addressed in the new Department of Labor Fiduciary Rule enacted earlier this month.
The study also highlights the need for independent, third-party validation of company 401(k) retirement plan mutual fund investment performance.
Ric Lager
Lager & Company, Inc.
