Author: 401kadmin

Bloomberg Law reports that class action lawsuits concerning 401(k) fees have seen a five-fold increase in the past 12 months!  The word is getting out that 401(k) fees skimmed from employees’ retirement savings are a severe problem, and financial advisors pocketing these 401(k) fees are feeling the heat. We think these lawsuits are a good…

401(k) AUM — 401(k) Assets Under Management — AKA The vast majority of 401(k) providers selling 401(k) administration and investment services to small American businesses are surreptitiously charging plan participants 401(k) AUM fees. “AUM” stands for “Assets Under Management,” and represents your total 401(k) retirement savings. If you have saved $50,000 in your 401(k), a…

Is Investing VC in 401(k) Start-Ups Sensible? In Part 1 of this 3-Part series, we discussed the problems of 401(k) fees skimmed from investors’ retirement savings, and how these fees become the primary economic driver and profit center that attract venture capital firms. Part 2 of this series listed three reasons why the small 401(k)…

Venture capital (VC) firms making bets on new 401(k) provider “start-ups” are making a mistake, and simultaneously supporting the evil practice of skimming 401(k) fees. There are three reasons we make this claim: Reason 1 401(k) provider “start-ups” funded by venture capital firms are targeting small businesses. Small businesses have historically shunned 401(k) plans because…

This question of whether one is better off with contributing to the traditional 401(k) or Roth 401(k) is the subject of debate. We come down firmly on the side that a Roth 401(k) is more a gimmick than a legitimate financial tool, and people who use Roth 401(k) end up, over the long term, paying…

Effortless Access to Mutual Fund Performance Getting detailed, updated mutual fund performance information is quick and easy. Simply go to your favorite browser search engine (i.e. Google, Firefox, Edge, etc.) and type in the search field the following: Morningstar + (ticker symbol), and click “enter” You will be taken to the Morningstar mutual fund performance…

Disadvantages of 401(k) contributions Please keep this in mind; 401(k) loans are definitely not a good source for quick or emergency cash. 401(k) loans have significant negative consequences, both immediately and in the long-term. If you’re considering a 401(k) loan, please be aware of the following…… Applying for a 401(k) loan is time consuming and…

Are 401(k) Fees Skimming Your Money? Answer: Probably, according to non-profit AARP, the answer is “YES”. We think 401(k) financial advisors who are deducting fees from participants 401(k) retirement savings are essentially “pick-pockets.” Why do we say this?  A pick-pocket is someone who takes money from you when you are unaware it is happening. So…