I had previously written about the fact that law firms are especially prone to excessive fees. I’d now like to provide an example of one of the most overpriced law firm retirement plans I have seen: Klein, Thorpe, and Jenkins. Here is a summary of the total service charges listed on their 5500 form:2013: $49,6942014: $75,1032015: $69,0312016: $64,6312017: $69,9382018: $76,6672019:
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Comparing 401(k) Advisory Fees to Health Insurance Broker Commissions: A Deep Dive
Have you ever looked at your retirement account statement and wondered why it hasn’t increased more over the years or why you have seen a recent decrease? Or why you have to pay so much in health insurance premiums, who is getting paid behind the scenes, how much you have paid in fees over your lifetime, and if these payments
The Hidden Costs: A Deep Dive into 401(k) Fees of Major Corporations
When you think of companies like Salesforce, Marathon Oil, Walmart, Microsoft, and Apple, you probably picture industry giants with robust employee benefits. However, a closer look at their retirement plans reveals confusing costs that might be affecting their employees more than you’d think.—Dissecting the Numbers:Let’s begin by breaking down the estimated fees per participant for 2021-2022:- Salesforce: $60 per participant
Allstate Retirement Plan Evaluation
Large plans have far lower fees per participant than smaller plans do, but even these plans aren’t always such a good deal for plan participants. The Allstate 401(k) Savings Plan is one example. Here is a summary of the information shown on the 2021 5500 form:Plan assets: $7,065,769,220Employer contributions: $110,395,894Employee contributions: $574,126,173Plan participants: $61,520Fees:$3,190,520 (Alight Financial Advisors)$1,933,275 (Alight Solutions LLC)$809,675
403 (b) Plans Have the Same Vulnerability to Excessive Fees as 401(k) Plans
If you are under the impression that excessive fees don’t apply to 403(b) plans, consider the example of The Sherwood Foundation, chaired by Susan A. Buffett, daughter of Warren Buffett. Of all 403(b) plans that you would think would be managed in a fiscally responsible manner, you would think it would be this one, but this summary of commission payments
Why Small Law Firms are Especially Vulnerable to Excessive Fee Lawsuits
Since I began focusing on employer-sponsored retirement plans about 14 years ago, I have closely followed the litigation landscape. Most of the lawsuits I read about dealt with very large organizations with over $1 billion in assets who were passing on excessive investment management, administration, and record keeping fees to their employees. While these lawsuits have served to protect participants
Legalized 401(k) Fraud
There are a litany of laws protecting participants from fraud that have helped victims recover their money, but these laws only deal with theft. Fraud can still occur in the absence of outright theft in the form of mere misappropriation of assets, which is a form of embezzlement, defined by the Cornell Law School Legal Information Institute as:”The fraudulent taking
How employees can encourage their employers to create a better retirement plan
Understanding how your company’s retirement plan works can be intimidating. Many people know they have a list of investment options, but don’t understand them and all of their associated costs. Unfortunately, the employers have little understanding either, primarily due to not having an incentive to care as I explained in a previous post.I created a list of questions participants
What Services Should Financial Advisors Provide for Retirement Plans?
In my nearly 20 years as a financial advisor (12 years solely focused on 401(k) plans), I have rarely come across business owners who know what they are paying their financial advisor for their retirement plan, let alone those who are actually getting anything out of the advisor. The typical arrangement works like this: The advisor gets an “assets under
How Guideline is Disrupting the Retirement Plan Industry and Enabling Participants and Employers
For nearly the past decade, I have been speaking, writing, and advising businesses about the lack of transparency, excessive and unnecessary fees, and conflicts of interest in the retirement plan industry. For a litany of reasons I have explained, the industry does not operate anywhere close to a free and competitive market, and as a result, retirement plan service