Over the past week, I have had several clients mention the recent PBS Frontline special, “The Retirement Gamble” (Retirement Gamble). I have also read several negative comments from my industry regarding the piece. After finally finding the time to watch it this morning, I believe it was honest and well done. It is refreshing to see PBS do a piece that includes two of the three messages we try to relay to investors every day.
- A Fiduciary places investors interest before their own
- Fees steal returns and are one of the most important determinants in investment outcomes
It is amazing to me that only 15% of all advisors are actually fiduciaries for their clients. It is also amazing how much lobbying money is spent to make sure that this trend continues, which is clearly not in the best interest of investors.
Regarding fees, there is another wonderful piece published by Standard & Poor’s which clearly shows the problems with mutual funds. The link for that piece is here S&P SPIVA Report. Maybe the president of Prudential, Christine Marcks, should read this as she claims in the Frontline documentary that she has never seen this type of research.
At the end of the day, most workers are not going to have the luxury of a pension. As a result, consistent saving and prudent low cost investing are going to be more important than ever to ensure a happy retirement.