In a room full of avowed capitalists, policies that sound to some like socialism are bound not to go over well.Delivering Alpharead more
At least in terms of monetary policy, Pence says should be taking after other regions who keep their benchmark interest rates near zero.Delivering Alpharead more
AT&T isn't focused on selling or divesting DirecTV, despite pressure from stakeholder Elliott Management, sources tell CNBC.Technologyread more
The measure to keep the government running through Nov. 21 now heads to the Senate, where McConnell has signaled he will back a temporary spending plan.Politicsread more
Amazon's purchase comes as part of its plan to convert its delivery fleet to 100% renewable energy by 2030. The e-commerce retailer already runs 40% of its fleet on renewable...Autosread more
As part of the plan, Amazon has agreed to purchase 100,000 electric delivery vans from vehicle manufacturer Rivian.Technologyread more
Apple's iOS 13.1 will be released on Sept. 24, six days earlier than previously announced.Technologyread more
Hedge fund titan Leon Cooperman said he's concerned about a shift to the left in the political landscape, which could harm the economy and the stock market.Delivering Alpharead more
The plan will allow Medicare to negotiate lower prices on as many as 250 drugs and apply those discounts to private health plans.Health and Scienceread more
The move could bring a welcome salve to farmers caught in the crosshairs of the trade war if it results in a reopening of the market.Politicsread more
The pilot program will deliver food and beverage, over-the-counter medications and other items within minutes, the company said. Prescription deliveries will not be available.Health and Scienceread more
If your 401(k) is a little cheaper these days, make sure you thank your former co-workers.
A recent report from the Center for Retirement Research at Boston College found that a rash of lawsuits against employers in recent years is causing companies to rethink their fund offerings and push for lower fees.
"These lawsuits aren't brought by the Department of Labor, but rather by former employees," said Geoffrey T. Sanzenbacher, associate director for research at the Center and a co-author of the report.
"This is the most interesting thing: The plan sponsor — the employer — is the one who is really liable, even if they don't know the most about the plan," he said.
Here's how a flood of litigation may have helped you save a few bucks at work.
The Labor Department has two sets of fee disclosure regulations: One compels fiduciaries (your employer in this instance) to spell out expenses to participants, while the other requires service providers to divulge fee details to employers.
Although the federal agency doesn't necessarily specify a cost for plan services and investments, it does require that employers document their selection process and make prudent choices.
Lack of specific guidance from the Labor Department means that employers may not be aware that they're violating the rules until either the agency pursues them or they get hit with a lawsuit, according to the Center for Retirement Research report.
See below for a graph depicting the number of lawsuits surrounding 401(k) plans.
The Center for Retirement Research report identified three key areas of retirement plan litigation:
In the wake of heightened legal action around 401(k)s, employers have adjusted their retirement plans for a win-win: lower fees for employees and reduced litigation risk.
Mutual fund costs have been falling for plan participants, going to 48 basis points in 2016 from 77 basis points in 2000, according to data from the Investment Company Institute.
During that same period, expenses for recordkeeping services — which include tracking workers' investments and managing withdrawals — fell to 46 basis points from 57 basis points, the Center for Retirement Research report found.
Further, fee-conscious investors poured assets into index funds. The chart below shows the overall percentage of retirement and nonretirement assets invested in index funds from 2001 to 2016.
What remains to be seen, however, is whether fear of litigation could spook employers — particularly the smallest companies — from offering these plans in the first place.
The largest plans with the most assets tend to be the ones with the greatest ability to negotiate lower expenses.
"One of the issues with small retirement plans is that the characteristics aren't chosen by the employers, but by the person selling the plan," said Sanzenbacher. "Understanding fees isn't really the specialty of the small employer."
More from Personal Finance:
Hit the brakes before you take this step with your 401(k)
Labor Department to investors: Watch your back as court dismantles protection rule
Your retirement finances may not be as bad as you think, survey finds