Re: where is the leak
Watchdog
7/31/2012 11:39:35 AM
Most plan trustees do not take their role seriously. They turn 401k assets over to brand name fund families so they cannot be criticized for their selection decision. Then they accept whatever the fund families charge. The same is true for TPAs, custodians, broker/dealers and other service providers. Wall Street is adept at extracting maximum fees from participant assets.
Trustees need training and tools that help them monitor performance, expense, risk exposure, and other critical variables that impact when people retire and how much money they will have when they retire.
Re: Investor Watchdog
Watchdog
7/31/2012 11:03:14 AM
No errors or omissions. Our minimum standards and rating system create the low acceptance rate.
Most advisors are eliminated by our minimum standards. Advisors must be RIAs or IARs, fee only or fee based, with clean compliance records. These standards eliminate 75% of the "advisors" in America who are really sales reps.
We also use a proprietary algorithm to rate the quality of advisor credentials, ethics, and business practices. There are 17 criteria. Only a small percentage of the remaining advisors score high enough to be profiled in the Registry.
Investor Watchdog (www.InvestorWatchdog.com) does all of the vetting for the Paladin Registry. The Registry is a free investor service that is provided by Investor Watchdog.
The SEC has reviewed ... our rejection rates (93%) for advisors who submit data to us.
@Jack,
Do you mean to say that 93% of financial advisors who submit data to Watchdog still have errors, omissions or problems that are serious enough to reject their data?
Re: where is the leak
tokyogai
7/31/2012 9:41:31 AM
It sounds like maybe getting a number of people to complain and to threaten some type of class action may be needed to get this fixed. Good Luck.
For quite a while, I suspect the service provider of my 401K plan is ripping money from all participants. I checked the Form 5500, but can't get a clue. Last month I received the detailed disclosure about all the fees charged on the account, and it is a shock to everyone.
The company recruited financial engine (FE) to provide consulting service for all 401k participants. As most experienced investors know that it is an useless service at a hefty fee. What kind of advice can you get from a selection of less than 10 index funds. Most participants opted it out and think we are not pay a penny to Financial Engine. We are deadly wrong. According toe the new disclosure, every one was paying fee to FE even you don't choose its service. It is a total ripoff
The company told us that it covers all the plan related cost, and we believe so. But the disclosure shows that employees are paying the book keeping cost to Hewitt all these years.
I guess it is the time to kick some butts at the HR department.
I just took a look at the site as well, and it looks like there are some good resources there. Its something to bookmark and play around with.
Re: Investor Watchdog
tokyogai
7/30/2012 4:06:55 PM
I have looked it over and the website seems to be a valuable tool for investors and even fund amangers. I wonder if a lot of the funds are more sensitive to the costs because the returns are so low? A pension fund that was projecting 5% return and is seeing 3% must look harder at the expense line than one that is exceeding projections.
Re: Investor Watchdog
Watchdog
7/30/2012 2:49:36 PM
In regard to Watchdog's objectivity, all of its online services are free to investors. We have nothing to sell them. We provide tools that investors use to gather data from advisors. The tools produce reports that investors use to make informed decisions when they select, retain, and replace financial advisors. Investors can use these tools to evaluate and monitor any financial advisor in America - there are no restrictions. If investors don't know any advisors they have the option of using our Registry which profiles pre-screened advisors who achieved five star quality ratings when we reviewed their credentials, ethics, and business practices. The advisors who are profiled in the Registry pay fixed monthly fees for the listing. The SEC has reviewed our screening and rating processes and our rejection rates (93%) for advisors who submit data to us. This is as objective as we can make it.
Thanks for the information @Jack. It is indeed a dog-eat-dog world out there!
I'm wondering about Investor Watchdog. Looks like an interesting site, but how dispassionate and objective are they? If they're like the not-for-profit rating service, Guidestar for pension plans, then wonderful. If they are paid to recommend financial services professionals, then maybe not so great. What do you know about them?
The blogs and comments posted on Investor Uprising do not reflect the views of Investor Uprising, PRNewswire, or its sponsors. Investor Uprising, PRNewswire, and its sponsors do not assume responsibility for any comments, claims, or opinions made by authors and bloggers. They are no substitute for your own research and should not be relied upon for trading or any other purpose.
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