News for social, fiscal & national security conservatives who believe in God, family & the USA. Upholding the rights granted by God & guaranteed by the U.S. Constitution, traditional family values, "republican" principles / ideals, transparent & limited "smaller" government, free markets, lower taxes, due process of law, liberty & individual freedom. All content approval rests with the ARRA News Service Editor. Opinions are those of the authors. While varied positions are reported, beliefs & principles remain fixed. No revenue is generated for this site - no paid ads accepted - no payments for articles. Fair Use doctrine is posted & used. Editor/Founder: Bill Smith, Ph.D. [aka: OzarkGuru & 2010 AFP National Blogger of the Year] Follow @arra Contact: firstname.lastname@example.org (Pub. Since July, 2006)Home Page
One of the penalties for refusing to participate in politics
is that you end up being governed by your inferiors. -- Plato
Wednesday, April 06, 2016
The Obama Administration’s New Retirement Plan Regulations Will Cost Workers, Retirees
Obama Plan ‘Could More Than Double The Cost Of Investment Advice For Many Savers’ Or Push Investors ‘To Settle For Computer Generated Robo-Advice’
“President Obama’s plan to reform retirement savings could more than double the cost of investment advice for many savers. … A recent study by Cerulli Associates found that while the current commission model costs on average 0.5% of assets, the fee-based model would cost 1.1% of assets plus additional fund expenses.” (“Democrats Against Obamasave,” Wall Street Journal, 10/11/15)
“An estimated 45% of Americans have accounts with less than $25,000, according to the Employee Benefit Research Institute, which is the minimum required balance Primerica could find for a fee-based broker. Without the commission model, these investors would need to settle for computer generated robo-advice.”(“Democrats Against Obamasave,” Wall Street Journal, 10/11/15)
SENATE HOMELAND SECURITY & GOVERNMENTAL AFFAIRS COMMITTEE REPORT:“A 2015 report estimates that the rule will cause a loss of retirement savings of $68–80 billion per year, and will ‘jeopardize retirement readiness for 11.9 million IRA and retirement participants.’ Robert Litan, an economist and attorney who served as the associate director of the White House budget office in the Clinton Administration, predicts that seven million or more small investors could lose their brokers as a result of the rule. This would be costly to investors, who may make worse investing decisions when they do not receive human investment advice.” (“The Labor Department’s Fiduciary Rule: How A Flawed Process Could Hurt Retirement Savers,” Committee On Homeland Security And Governmental Affairs, 2/24/16)
CEI: “For illustration, we can look to what happened in the United Kingdom after it banned third-party commissions in 2013. A June 2013 study by the Cass Business School at City University London found that brokers had largely stopped serving British savers with portfolios below £150,000 ($240,000), because the fees alone would not pay for servicing the accounts. This study and other research estimates that this ‘guidance gap’ will see 85 percent of British savers lose their brokers or get reduced services for their retirement accounts. … similar effects will take place here…”(The Department Of Labor’s Fiduciary Rule For Dummies,” Competitive Enterprise Institute, 3/2/16)
‘Expecting Robots To Safeguard The Retirement Security Of Small Savers Is … Hubris’
DAN GALLAGHER, SEC Commissioner: ‘Less well-heeled customers will be … jettisoned to robo-advisers’ “I feel compelled to weigh in on the Fiduciary Proposal because I am convinced that the rule, when finalized, will harm investors and the U.S. capital markets … Less well-heeled customers will be ‘fired’ by their brokers or jettisoned to robo-advisers.” (SEC Commissioner Dan Gallagher, Letter To Sec. Perez, 7/21/15)
DOL: ‘Individual Retirement … Seldom Have The Training Or Specialized Expertise Necessary To Prudently Manage Retirement Assets On Their Own,’ But Rather Than Personalized Investment Advice, They Should Rely On ‘Technology-Based Tools’ Created By ‘A Startup’ A Few Years Ago
DEPT. OF LABOR PROPOSED RULE: “Today, individual retirement investors have much greater responsibility for directing their own investments, but they seldom have the training or specialized expertise necessary to prudently manage retirement assets on their own. As a result, they often depend on investment advice for guidance on how to manage their savings to achieve a secure retirement.” (Federal Register, Volume.80, No.75, P.21930, 4/20/15)
THOMAS PEREZ, Sec. of Labor: “Successful firms like Wealthfront, the Garrett Planning Network, Financial Engines and Personal Capital are there to occupy this important market niche. … I believe our rulemaking can serve as catalyst for innovation in the industry, as more firms devise new tools and strategies assisted by modern software and other technology-based tools to accommodate even those with only a few thousand dollars to invest.” (Sec. Perez, Remarks, Brookings Institution, 10/16/15)
PEREZ: “Well, one thing that has been really helpful, and I've certainly learned a lot about this industry over the course of the last two years, is that technology is a huge ally. … And I mentioned in my opening remarksa company out of California Wealthfront. They're a startup. They're four years in.”(U.S. House Of Representatives, Committee On Education And The Workforce, Hearing, 6/17/15)
SEC: ‘Investors Should Be Wary’ Of ‘Automated Investment Tools’
SEC Investor Alert: ‘It is important to understand their risks and limitations before using … automated investment tools’ “At the swipe of a fingertip on a mobile device or the click of a mouse on a desktop computer, investors can access a broad range of automated investment tools. … While automated investment tools may offer clear benefits—including low cost, ease of use, and broad access—it is important to understand their risks and limitations before using them. Investors should be wary of tools that promise better portfolio performance.” (“Investor Alert: Automated Investment Tools,” Securities And Exchange Commission, 5/8/15)
Tags:Obama Administration, New Retirement Plan, Regulations, Will Cost Workers, Retirees 401-PayTo share or post to your site, click on "Post Link". Please mention / link to the ARRA News Service. and "Like" Facebook Page - Thanks!
Personal Tweets by the editor: Dr. Bill - OzarkGuru
Married 48yr #Conservative #Constitution #NRALife #GunRights #USAF 22yr #military #veteran #Christian #CCOT #ProLife #TEAParty #GOP #TCOT #SGP #schoolchoice
Comments by contributing authors or other sources do not necessarily reflect the position the editor, other contributing authors, sources, readers, or commenters. No contributors, or editors are paid for articles, images, cartoons, etc. While having reported on and promoting the beliefs associated with the ARRA, this blog/site is not controlled by nor funded by the ARRA. This site/blog does not advertise for money or services nor does it solicit funding for its support.
Fair Use: This site/blog may contain copyrighted material the use of which has not been specifically authorized by the copyright owner. Such material is made available to advance understanding of political, human rights, economic, democracy, and social justice issues, etc. This constitutes a 'fair use' of such copyrighted material as provided for in section Title 17 U.S.C. Section 107 of the US Copyright Law. Per said section, the material on this site/blog is distributed without profit to readers to view for the expressed purpose of viewing the included information for research, educational, or satirical purposes. Any person/entity seeking to use copyrighted material shared on this site/blog for purposes that go beyond "fair use," must obtain permission from the copyright owner.