Over at PostEverything…it’s designed to re-align the interests of savers and financial advisors as the misalignment is costing retirees as much as percentage point a year. The financial lobby is not at all pleased with this development.
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Well isn’t part of the goal of eliminating traditional pension plans and privatizing and individualizing retirement savings? Similar to the aborted plan to privatize social security? Instead of multitudes of people pooling their resources to spread risk, lower costs of investment services with economies of scale, and align interests vs. inevitable conflict that profits from churn, each individual is expected to become a financial expert, or discriminate between competent advisors, all with the unrealistic goal of beating the market.
Surly the financial services industry lobby, with huge profits at stake, and generous campaign contributions to various parties couldn’t be influencing principled politicians who are merely promoting fee enterprise? Excuse me, free enterprise?
The rules, while you are active in a 401k, are very strict and avoid adviser conflict of interest for most employees, simply because most participants go with a mutual fund group with a menu of choices. The fees for 401k management are another matter and should be regulated, because that’s where you can lose another 1% a year.
I know of some older folks whose savings were churned away by advisers. Sad that many are robbed so a few can be very rich. That’s unregulated capitalism at its worst, and the only “free” in that free enterprise is the freedom for vultures and hyenas to devour the weak..