Tony Robbins continues his trek for 401(k) fee transparency.
America’s Best 401k, of which Robbins is partner and primary pitchman, announced Friday the launch of ItsYourMoney.com to coincide with National 401(k) Day.
The low cost 401(k) provider and “full-service option focused on reducing investment-related fees” said the site will educate consumers on the true cost of hidden fees in retirement plans.
“We are in the only world that I know of—this investment world, this financial world—where someone can have the same product and the same services,” Robbins said in an interview with 401(k) Specialist. “One person over here is buying a Honda for $20,000 and another person is buying the same vehicle for $350,000 and it’s the same damn car. It’s ridiculous. You’d go crazy if you were the guy paying $350,000. People are angry.”
Visitors to the site will find videos, infographics and other “straightforward tools” for evaluating their retirement plans, including a fee-checker that allows users to determine exactly how much their retirement plan is costing them in fees. In addition, ItsYourMoney.com provides examples that illustrate and compare the real-life fees charged by a number of well-known providers in the industry.
“Most hardworking Americans who contribute to a workplace retirement plan are unaware that they may be paying several different layers of fees, which directly subtract from their investment returns,” Tom Zgainer, CEO and founder of America’s Best 401k, said in a statement.
The reality, he added, is that these fees often include “layers of commissions and kickbacks to the plan providers and brokers at the expense of those investing in the plan. The erosive effect is disastrous for the future of Americans who are hoping their money will sustain them through their golden years.”
Egregious 401(k) plan fees recently generated attention in the media when John Oliver, host of HBO’s Last Week Tonight, blasted the industry in a segment on his show. In addition, the company noted, a growing list of 401(k) providers have been sued by their employees for excessive fees in their own 401(k) plans.
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
There is much improved transparency than previously; that is why the service provider fee disclosure rules under ERISA section 408(b)(2) were enacted July 1st, 2012 and the participant fee disclosure regs. 60 days later under ERISA section 404(a)(5). If plans want to be sure their fees are reasonable for the value of the services provided, they can get a third party certification from the Centre for Fiduciary Excellence (www.CEFEX.org)and going to http://www.401kFeeDisclosure.com.
Funny he mentions the price of a car. You go and pay sticker or more and I negotiate under sticker for same car. Nobody screaming for car dealers to change the way they do business.