401(k) Stories

The days when RIAs were the outsiders at the 401(k) party are fast coming to a close. What's new is that the mass of 401(k) assets is getting critical at about $3 trillion; fiduciary advisors are getting appreciated; fat fees and questionable kickbacks are getting exposed and stepping out of line is getting dicier as the Department of Labor tightens the regulatory screws.

The old reasons why the 401(k) business is attractive are still in place: there are fresh assets pouring in every month and when employees leave jobs or retire, they produce rollovers that build up IRA accounts for financial advisors. The drawbacks of getting into the 401(k) business are still in place, too. Dealing with retirement assets is really a second line of business and it remains -- unless you overcharge with hidden fees -- a low margin business with high potential fiduciary liabilities.

Still, the outsourcers, infrastructure and accumulated knowledge for RIAs to capitalize on is growing daily and a the mega-shift of assets away from brokers is making the 401(k) business riskier and riskier -- to ignore.


Scott MacKillop: The real concern is that the rule will prevent the industry from charging retirement plan clients high fees and offering them conflicted advice.

The time is now for the investment industry to shed its shameless culture or pay a steep price

Enough feeble excuses and convoluted rationalizations for delaying the DOL rule

January 19, 2017 — 7:03 PM UTC by Guest Columnist Scott MacKillop

They stab it with their steely knives, but they just can’t kill the beast. -- The Eagles, Hotel California 

It’s a shameful sight.

For more than six years, forces within our industry fought tooth and nail to prevent enactment of the Department of ...

4 Comments
Irwin Stein: Unless the advisor is in a coma, it is always an uphill battle for a client to question an advisor’s judgment.

A veteran securities lawyer takes contrarian stance that the DOL is still 'suitability' reworded, when boiling its 1,000-page 'rule' down to 16-page 'guide'

In prolix prose, the Labor Department's 'exemptions' sound like fiduciary exceptions; as poems, they sound like suitability-level loopholes

January 18, 2017 — 6:23 PM UTC by Irwin Stein

Brooke's Note: Irwin Stein penned one of our better-read articles of 2016: A veteran of securities law killed his weekend reading all 1,000 pages of the DOL rule -- and has a takeaway to share. Fortunately for us, I convinced him to kill ...

3 Comments
Jay Hummel: I would put our rep-assisted phone service up against anyone in the business.

After leaving Envestnet, Jay Hummel pops up at American Century with a 21st century plan

The former 'thought leader' is moving three children to Kansas City to more rapidly move the old-line mutual fund company to action

January 4, 2017 — 7:06 PM UTC by Sarah O’Brien

Brooke's Note: The mother of invention is necessity and arguably no necessity is more urgent than that of legacy active asset managers as ETFs and robo-advice take command. The chief value proposition of these products is fiendishly clever: they are dirt cheap. But cutting costs is a loser in ...

0 Comments
Peter Mallouk owns a $21-billion RIA already growing with organic ferocity. Then Tony Robbins shows up and whoosh.

The 10 RIABiz stories advisors connected with most deeply in 2016 and how hubris and humility ran amok in this didn't-see-it-coming year

How did Aequitas swamp CONCERT? Power outages at LPL, Cetera and Wealthfront? Adolescent robo problems? And was that Tony Robbins hawking his money book ... again?

December 28, 2016 — 5:54 PM UTC by Dina Hampton

Brooke's Note: Choosing which articles were of greatest interest to RIABiz readers in 2016 was easy because a Google robot  measures the final results of your reading output.  We then refresh your human memory about why the story was so irrestistible at the time. Big ...

2 Comments
Andy Puzder takes a minimalist approach to the pensions of his workers.

Mum on DOL rule, Labor chief appointee Andy Puzder's 'check-the-box' 401(k) plan at CKE Restaurants speaks volumes

The expensive Mercer-advised pension plan has low participation rates, low balances, no matches and few assets overall

December 13, 2016 — 8:50 PM UTC by Janice Kirkel

Brooke's Note: Secretary of Labor appointee Andy Puzder replaces a very pro-DOL rule Thomas Perez. See: As President Obama takes the gloves off, pro-broker groups throw up 'sledgehammer' response. Puzder generally dislikes anything that'll trouble an employer. That's a concern unto itself for DOL-rule advocates. But ...

0 Comments
The report provides answers that add some clarity but surely will displease most people in the industry.

One security lawyer's unvarnished take on DOL's 34 answers to 34 questions and what unsettles him about them

The 24-pages of government-speak only make a dent in comprehending the 1,000-page rule -- and the DOL says there's more guidance on the way

November 8, 2016 — 6:46 PM UTC by Irwin Stein

Brooke's Note: As a career securities attorney Irwin is a clear-eyed reader of DOL FAQs. He also has clear misgivings about the way that the Department of Labor is trying to interrupt the massive conflicts of interest built into the financial advice business in the United States.   ...

1 Comment
David Barrer: I have relationships with recordkeepers and advisors that span my 30-plus years in this business.

With DOL wind at its back, Pentegra Retirement Services hires David Barrer to newly created TPA czar position to sail past its $11-billion AUM watermark

Barrer will apply his 32 years of ERISA retirement plan experience for dead reckoning navigation of 'yet to be determined' liability under the new fiduciary rules

November 3, 2016 — 5:45 PM UTC by Sarah O’Brien

Brooke's Note: If you seek hard evidence that our understanding of how the DOL rules will play out is soft, have a look at the whirlwind of personnel moves going on with ERISA experts being granted unprecedented power and opportunity. Andy Sieg replacing John Thiel at ...

1 Comment
Mike Alfred (with brother Ryan, l.): It's pretty magical to get to build something from scratch and to experience the whole journey with family by your side.

Buyer scoops up BrightScope using Genstar capital

The once-brash Alfred brothers sought out Strategic Insight as the DOL rule comes thundering toward their 401(k) herd

November 1, 2016 — 2:11 PM UTC by Brooke Southall

Brooke's Note: Today 401(k) transparency is all the rage, what with the Department of Labor finding its inner outrage about the ways the free enterprise system twists our post-defined benefits pension system into a righteous knot. But before Phyllis Borzi woke up the bureaucrats we all just ...

3 Comments
Mike Alfred (with brother Ryan, l.): It's pretty magical to get to build something from scratch and to experience the whole journey with family by your side.

Buyer scoops up BrightScope using Genstar's bucks

The once-brash Alfred brothers sought out Strategic Insight as DOL rule came thundering toward their 401(k) herd

October 31, 2016 — 10:04 PM UTC by Brooke Southall

Brooke's Note: Today 401(k) transparency is all the rage, what with the Department of Labor finding its inner outrage about the ways the free enterprise system twists our post-defined benefits pension system into a righteous knot. But before Phyllis Borzi woke up the bureaucrats we all just ...

0 Comments
Wayne Bloom: Are you going to sit around and hope? You can't do that.

Commonwealth Financial to dump commission business for IRA and 401(k) accounts

Overcoming a 'challenging decision culturally,' Wayne Bloom pulls the trigger ahead of IBD rivals for his Waltham, Mass.-based broker-dealer

October 24, 2016 — 10:47 PM UTC by Brooke Southall

This article was updated with the comments of Ameriprise CEO to show what the exact opposite DOL attitude looks like at a broker-dealer.

Brooke's Note: This news broke late yesterday so I wasn't able to reach Wayne Bloom, who will take credit or blame for his company's ...

1 Comment