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Lessons From UnShakeable by Tony Robbins, Chapter 4

Happy Today!

RESCUING OUR RETIREMENT PLANS What Your 401(k) Provider Doesn’t Want You to Know

This chapter could be considered a cautionary tale of what happens when we fail to read the fine print and trust others to handle our 401K accounts without our active oversight. But in reality it is an educational segment of the extra fees that are associated with the use of our plans.

The authors take their time explaining how fees impact your retirement accounts. They detail the extra expenses such as:

  • Contract asset charges
  • Investment expenses
  • Investment management services
  • Record keeping
  • Communication expenses
  • Bookkeeping expenses
  • Administrative expenses
  • Legal expenses
  • Transactional expenses
  • Stewardship expenses

It cautions is on provides information on other programs which may not include the excessive fees. Below are a few key points from the chapter.

Become educated about your 401k fees

A worker who earns about $90,000 a year would lose $277,000 in 401(k) fees.

Tony Robbins, Unshakeable

“This is why it’s so important to be aware of how the financial industry stacks the odds against you. Knowledge is your first defense. After all, how can you protect yourself from a threat to your financial well-being unless you know that this threat exists?” – Tony Robbins

“Think of fees like termites: they’re tiny, they’re barely noticeable, and they can eat away your f———g future.” – John Oliver

“The corrosive power of fine print and buried fees can eat away like a chronic illness at a person’s savings.” – Secretary of Labor Thomas E. Perez

Understand who is participating in the mutual fund pool.

”Many of the funds you get to choose from in your 401(k) plan are on the list only because the fund company paid the provider to include them! These funds tend to be actively managed, so they’re expensive. And they’re rarely the best performers. In some cases, they even charge a “front-end load”: a fee that often amounts to 3% of your assets just to buy the fund in the first place.” – Tony Robbins

Check your company’s 401K fees

“Whether you are a business owner or an employee, you can see how your company’s 401(k) plan stacks up by using his free online Fee Checker tool at http://www.ShowMeTheFees.com. It will analyze your plan and calculate within seconds how much you’re being charged in fees.” – Tony Robbins

This chapter lived up to its title – What Your 401(k) Provider Doesn’t Want You to Know. It is information you may not need yet but would benefit from access to the information.

Til next time,

If you have a 401K plan or are considering one – review the fee checker tool – www.showmethefees.com

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