Fidelity not Learning from Their 401k Mistakes?

I reviewed a prospective client’s Fidelity 401(k) so that I could offer advice on where to place their money in it. My thoughts: “Wow, no lower cost, higher performing passive funds – only higher cost actively managed funds and no funds other than Fidelity funds.” As I looked through the Fidelity funds in this 401k I saw all the typical bad attributes seen in retail actively managed funds of excessive cash levels, high turnover, high expense ratios and low diversification. Then I do a google search on “fidelity law suits” and in 2014 Fidelity settled a lawsuit – by its own employees (!) and directly from the article are these words: “They [those filing the class action lawsuit] noted that the more than 150 investment options available in the Fidelity plan were all offered by Fidelity or a company subsidiary, according to the suit. And, at the end of 2010, nearly 85% of the plan’s assets were held in actively managed Fidelity mutual funds, which tend to charge higher fees than passively managed index funds.” Simply put – it’s disappointing what goes on in the world of 401k plans where millions of Americans end up with less money in retirement than...

Catholic Seniors Financial Session 2016

Hello to all who attended O’Reilly Wealth Advisors’ Senior Financial Topics Session Saturday, January 16, 2016 AND Saturday, February 20 at my home parish St. Elizabeth Seton, Carlsbad, CA. This blog serves as a depository of links to documents, websites and videos mentioned in my talk, as well as the presentation itself – and additional related information. I also encourage you to look through all our blog posts as you will find great content describing the important concepts we discussed Saturday – and much more. We find the best content as well as creating our own. I added pertinent links not discussed in the sessions such as the US Bishops Statement on Euthanasia. I added a link on California’s passage in October of an euthanasia law which is why there is a renewed emphasis on insuring your Health Care Directive is congruent with Catholic beliefs. Be vigilant! More links we added since January. We found out about a free smoke detector program in SD County and have Know that we regularly conduct discovery meetings for anyone that requests them. It is the most important meeting we conduct because it establishes the reasons that drive you to be a good steward of your financial future (your “why”) and your specific tangible financial goals. Without these two critical pieces of information an appropriate financial plan cannot be written – and is unlikely to be executed over time. We also will critique your existing investments for you at no charge. Documents/Links: PowerPoint Presentation US Catholic Bishops’ Statement on Euthanasia Health Care Directive Document from the California Catholic Conference National Catholic Register News Article on Oct....

A Fun TV Advertisement that Makes an Important Point

You’ve all seen the Allstate insurance “mayhem” commercials. They’ve had the “mayhem” series in play for quite some time and as I write this they’ve created a contest where you can influence them on which version they show during the Super Bowl. One of the themes has been making fun of “do-it-yourselfers” – like an orthodontist taking on a home improvement project. Click here to see this 15 second commercial – hilarious! Orthodontists are highly trained, educated and caring people – in their profession. But all their talent, brains, caring and good intentions do not make them experts at investing or even more importantly, financial planning. An easy target and so true! Obviously, unless the orthodontist has a significant amount of experience and regularly practices home projects, their workmanship will fall short and it will be downright dangerous to be around them as they work! The same is true within the same general business. Look at home improvement: will a painter be a great electrician and visa versa. Only rarely. Even within a general area, specialized knowledge is very important. The same is true of people who attempt to take on financial planning and investing without experts guiding them. Interestingly – many “financial advisors”  – the product salespersons – make the same mistakes as those who are not trained. The “real advisors” – registered investment advisors that are licensed, willing and able to give investment advice are less likely to make investment mistakes. And investment success is not about homeruns as the media portrays it, but rather about avoiding mistakes. One of the proofs of this is published annually – the Dalbar Report....