Many business owners are not aware they are placing themselves in a dangerous position with the type of 401k plans they are offering their employees. They can be held personally liable.
St. Louis, Missouri (PRWEB) November 30, 2011
Bryan Binkholder, The Financial Coach, and long-time advocate for investors has released a new book, The 401k Conspiracy: How Companies and Employees are Being Robbed by Wall Street as the Government Looks the Other Way, created especially to educate small business owners, plan sponsors, and employees of the hidden problems attached to most popular 401k plans.
As Bryan puts it, "There is a wave of misinformation directed toward placing investors in a helpless position where they are essentially bullied into feeling the need for direction by financial advisors who are pushing products, such as mutual funds. This misinformation includes everything from cleverly worded advertisements that tout past performance as a form of security for future returns, to misleading titles of the financial advisors themselves that make these financial product pushers seem more credible than they really are."
Bryan cites a recent Wall Street Journal article entitled, "When Your Advisor Can't Be Trusted," in which Karen Blumenthal writes, "The first question to ask: Is the person who gives you advice on your portfolio and retirement account a registered investment adviser or a broker dealer?"
"Yes, that's a good starting point," Bryan advises, "But the rabbit hole is much deeper than that. There are numerous titles financial salespeople are hiding behind, but simply placing blind trust in an individual who holds the title of a registered investment advisor is not nearly enough protection. In my book, The 401k Conspiracy, I outline the importance of working with FEE ONLY registered investment advisors. The brokerage industry has come up with yet another slick new title called the fee-based advisor that can actually wear one hat and act as a fiduciary but then switch hats to sell loaded mutual funds, annuities or bonds to earn a commission. I believe that anyone who earns a commission can't remain loyal to the best interest of the investor."
Another current problem that Binkholder discusses in his book, is the fiduciary duty when it comes to company 401k plans. "Many business owners are not aware they are placing themselves in a dangerous position with the type of 401k plans they are offering their employees. If you're in charge of your company plan, you have what the law calls a 'fiduciary responsibility' with the participants in that plan. This fiduciary duty is a legal or ethical relationship that can hold you personally liable for excessive fees, unsafe investments, or other inadvertent breaches of your fiduciary duty."
"That's why Jim Winkelmann and I wrote this book. We know that the best way to guard against mistakes is to be properly informed and aware of all of the available retirement options. Good decisions are hostage to good information. The more we can raise awareness about the duties and dangers of sponsoring a 401k plan, the more likely employers and plan sponsors will be to ask questions and make prudent decisions."
The 401k Conspiracy is available on The Financial Coach Website and includes information and resources designed to place plan sponsors and employers on the right path for the upcoming year.
About Bryan Binkholder
Also known as The Financial Coach, Bryan hosts a nationally syndicated radio program, The Financial Coach Show, which sheds light on current investment issues, exposes deceit and brings clarity to the often intentionally clouded industry.
Author of 7 Deadly Traps of Investing and The 6 Pitfalls of Retirement Planning, Bryan's determination to be a voice of change has earned him a respected reputation as a Watchdog of the Industry. His investment advice and opinions on the industry have been quoted in Forbes, The Wall Street Journal, Investment News, and Financial Advisor Magazine.
About Jim Winkelmann, RF™ and Blue Ocean Portfolios
Jim Winkelmann started Blue Ocean Portfolios in 2009, after enjoying many successful years in the industry but having the desire to break free from the self-serving agendas of traditional brokerage firms. His vision? To build a firm which would adhere to the highest ethical standard and share a common goal with the investor, putting their interests first, instead of the brokerage firm.
As a Registered Fiduciary™, Jim is part of an elite group of financial service professionals who are set apart from the conflicts of interest which have polluted the financial advisor/client relationship. Learn more at Blue Ocean Portfolio's Website, or by calling 636-530-9393.