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Major Disconnect in Survey on Impact of Fund Fees on 401(k) Participants

"The problem is that these surveys are aimed at the same people (plan sponsors) who necessitated the DOL to enact the new regulations in the first place. Unfortunately, many of these industry surveys ask the same people who are already clients to review their own performance.... [T]he same report also noted that over one-third (36%) of the plan sponsors surveyed believe that their Baby Boomer employees enrolled in their company retirement plans will work past the age of 65.... [But] if fees were reduced over the working careers of these employees, there is a good chance these same workers would not have to work past age 65 since their 401(k) accounts would be significantly larger."

For Investors Nearing Retirement, Time Is Not Always on Their Side

"[W]ith the huge losses in both home prices and in their equity portfolios, anyone approaching retirement should be trying to recoup their losses as fast as possible. But the basic mathematics of finance is against that.... If you owned an S&P 500 index fund in 2008, that fund fell by 37.5%. To recoup this loss, it would take an investor over five years to recover this loss assuming the traditionally-accepted 9.4% historical rate of return in the S&P 500 Index with dividends re-invested."

Who Does the Cost-Benefit Analysis for Individual Investors?

"[W]hat's missing are some number showing the negative effect on millions of naive American investors who unknowingly pay up to 17 separate fees when they buy a mutual fund.... [R]evenue sharing and 12b-1 fees, which would come into the light if a fiduciary standard, were enacted, cost investors about $9.5 billion annually. These fees paid by unsuspecting investors -- in revenue sharing, 12b-1, and in 401(k)s -- dwarf anything SIFMA and other financial services lobbying groups have offered as a way to attract sympathy.... [The] fact is that the lack of transparency, and the lack of a fiduciary standard, is very profitable."

News About 401(k) Fees Decreases Benefit All Investors But More Is Needed

"Based on new data ... small plan costs fell from 1.47% to 1.46% in 2012, while large plan costs fell from 1.08% to 1.03%. Expenses for small plans were between 0.38% and 1.97%, while large plan expenses ranged from 0.28% to 1.41%.... In most cases, the difference in changing from a more expensive to a lower-cost fund fee will more than compensate for a decrease in any fund investment returns over time ... because the difference between market return and a fund's individual return is directly attributable to a fund's costs."

Financial Services Industry Continues Its Anti-Investor Campaigns

"[K]ey elements of the financial industry are actively promoting legislative, regulatory and legal campaigns designed to denigrate any benefits to customer-investors, including a powerful campaign underway by a financial trade group to derail any pro-fiduciary actions from the [DOL]. What's more, these recent actions are not isolated. They are part of the ongoing campaign to ignore any admission that the financial services industry is broken and that it has an institutionalized disdain for its own customers."

Why Frontline's 'The Retirement Gamble' Is Important

"[1] It highlights a critical problem that affects 90 million Americans who invest in the $13 trillion mutual fund industry. [2] It highlights three problems which are widespread, but not often publicly discussed: the impact of high mutual fund and 401(k) fees; the conflicts-of-interest that prevail in the financial industry sales and advice industry; and wealth destruction. [3] It presents the problem facing millions of Americans who face a financially insecure retirement future [4] It addresses how millions of unprepared investors are now engaged in a do-it-yourself retirement planning process. [5] It shows how employers have transferred all retirement planning and investment risks, and most of the costs, to their employees."