Dawn of Randomness

Retirement Plan Shadows

Dawn of Randomness

How to Win Your Battle against the Money Management Machine

"It is difficult to get a man to understand something when his salary depends on his not understanding it."
—Upton Sinclair, The Jungle, 1906

"Everyone carries a shadow, and the less it is embodied in the individual's conscious life, the blacker and denser it is."
C.G. Jung, Psychology and Religion, 1938

The retirement plan industry is not evil, but it is full of shadows, or unknowns. Every industry carries them. Turns out the retirement plan business has among the blackest, densest and least known of all.

In these shadows, American investors are getting robbed blind. Most of America's employers, providers of various tax-advantaged defined contribution plans such as 401(k)'s to their employee investors, are going along for the ride. This is exactly the way the retirement plan industry, itself the ever-obedient servant of the money management machine, wants it.

Yet as Supreme Court Justice Louis D. Brandeis once wrote, "sunshine is the best disinfectant."  This exposé is composed for investors and employers in the United States today who want to take control away from the money management machine. In my experience of providing investment advice as an independent fee-only fiduciary, I know you must be out there.  In summary:

The Retirement Plan Industry "As Is":

  • Bundled Plan Delivery  ("We'll take care of it all, trust us")
  • Revenue Sharing  (Snappy new phrases disguising an ancient trade)
  • Hyperactive!  (Money management against all odds and investor interests)

The Retirement Plan Industry "Should Be":

  • Open Architecture Delivery  (Full disclosure fee transparency legal protection = great service)
  • Neuroeconomics  (Behavioral Finance; the next frontier in optimal investing)
  • Empirical Evidence  (Probability theory, priced risk, and global human ingenuity)

Brief and to the point, the bright light of sunshine rising over the unknown shadows of the retirement plan industry today reveals a shocking reality. I see now how even my own parents were ripped off by it over lifelong careers. Our generation need not suffer the same fleecing any longer. It's our money. We do not have to manage it the way financial industry has sold us into believing we should. It's their Faustian bargain, not ours.

Godspeed with your efforts to save and invest your hard-earned money for a lifetime of dignity as you see fit in your own best interest, not theirs.