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    401 Confidential: How 401(k) Companies Get Fat on Your Money...While You Slave at Your Cubicle.
    401 Confidential: How 401(k) Companies Get Fat on Your Money...While You Slave at Your Cubicle.
    401 Confidential: How 401(k) Companies Get Fat on Your Money...While You Slave at Your Cubicle.
    Ebook95 pages1 hour

    401 Confidential: How 401(k) Companies Get Fat on Your Money...While You Slave at Your Cubicle.

    By Michael J. Marini

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    About this ebook

    A consumer-empowerment book for people in 401(k), 403(b) & 457(b) plans.

    The average participant fee in small business 401k plans across the U.S is 4%. Fees are not much lower at even mid and large-size companies. Read my new book 401 Confidential to learn how employees can take the lead and drive change within companies by working with management to secure lower retirement plan fees.

    From The Back Cover...

    For every hundred dollars in your workplace retirement account, how much is your 401(k), 403(b) or 457(b) company slipping out the back door for themselves? Hint: Don’t ask your employer. They don’t know either. All they did was hire the company.

    And so it goes... In every town, in every workplace across the U.S... Employees blissfully trust that their employer selected a good retirement plan. Employers blissfully trust that they did too, completely unaware of what good actually looks like. The only ones who know what good and bad look like are the retirement plan companies, and therein lies the problem. It is a classic case of the fox guarding the henhouse. Only this fox is really smart, because you don’t even know if your hens are missing. You are about to find out.

    401 CONFIDENTIAL takes you on the inside of the retirement plan industry. I do a brain dump on how retirement plans are packaged, priced and sold to private and public-sector employers. I show you the dirty little secrets of the industry. I show what ultra-low fees and ultra-high fees look like. And I show employers and employees how to calculate your fees and take back what belongs to you. By the end of this book I shift the entire balance of power from the retirement plan companies to the retirement plan consumers.

    LanguageEnglish
    PublisherMichael J. Marini
    Release dateMay 28, 2018
    ISBN9780463667750
    401 Confidential: How 401(k) Companies Get Fat on Your Money...While You Slave at Your Cubicle.
    Author

    Michael J. Marini

    Michael J. Marini is a financial adviser and president of Orlando 401k Specialists. Other titles include: Finish Strong: 21 Life & Money Lessons For Professional Athletes.

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      Book preview

      401 Confidential - Michael J. Marini

      What Is a 401(k) Plan?

      A 401(k) plan is a piggy bank for grown-ups that you fill up with money from your paycheck. You need a piggy bank. Everyone needs a piggy bank. Why? Did you have a piggy bank when you were a child? Think back to that time and what that piggy bank meant to you. First, it was yours and you were proud of it. Am I right? Second, it was cool. You kept it in a special place and you really enjoyed dropping those coins in and seeing how heavy it became as time went by. Third, the piggy bank wasn’t something you started doing and stopped doing. You just didn’t see it that way. Your piggy bank was a part of you, and I’m sure many of you reading this still have your piggy bank. Others reading this probably wish you knew what happened to yours, myself included. Mine was chrome and I can still see that smiling piggy’s face.

      Now if the notion of a grown-up piggy bank sounds a little silly to you, ask yourself this. What do wealthy people have that most people only wish they had? Piggy banks. Really fat piggy banks.

      I could go on all day espousing reasons why you should be in a retirement plan and why you should pay attention to fees, but those would be my reasons. You have your own reasons for doing what you do. I am not fond of reasons. I am fond of emotions because emotions are at the core of all our decisions in life. And emotionally-speaking I don’t think anyone can argue the fact that piggy banks are flat-out cool, and quite frankly adorable.

      If you are the kind of person who nods off when someone starts talking about retirement or investing or saving, don’t think about it. Just do it. Go get your grown-up piggy bank and start stuffing it full every payday. The best time to start is immediately, and the right amount to put in is more than you think you can spare. Go big! Just like the piggy bank of your childhood you will enjoy dropping money in. You will enjoy the feeling of accomplishment as it grows heavier over time. And after finishing this book you will not see your grown-up piggy bank as something you start and stop. It will be a part of you and with you your entire life.

      Now if that wasn’t motivation enough, let me tell you the greatest things of all about your grown-up piggy bank. Your grown-up piggy bank does way more than just hold your money. It gives you cash back each time you drop money in. And then it turns your money into more money if you treat it right. And when you grow older and find yourself needing a helping hand in life, it stops taking money from you altogether and starts giving money back to you. Lots of it. Like clockwork. And it never stops giving back if you treat it right. Truthfully, your grown-up piggy bank loves to give way more than it loves to receive. And that is about as cool as it gets.

      Where Do You Get Piggy?

      You get your piggy bank at work. 401(k)s are the retirement plan of private-sector employers and are synonymous with the 403(b) and 457(b) plans of public-sector, non-profit and religious employers. The number & letter designation for each plan refers to IRS code. You can read the code for each plan by visiting www.irs.gov and typing 401k, 403b or 457b in the search bar. This is the number one place I recommend you go online to educate yourself about retirement plans and their features. I have also included helpful information and links later in Additional Resources.

      All three types of plans function the same for participants and remarkably so do the costs. The egregiousness of the fees charged by most 403(b) and 457(b) plan providers, just like their 401(k) counterparts, is nothing short of jaw-dropping. For the purposes of this book, consider the information herein to apply equally to private-sector and public-sector retirement plans. If you work in the public-sector and think you are immune to egregious fees because your 457(b) is by the well-known life insurance company that has the largest share of the business, think again. School teachers with their 403(b) TSA accounts are another extremely fee-gouged group of retirement savers. Stay with me because I am going to show you exactly how they do it.

      While retirement plans are standard-fare with public-sector employers, there is no guarantee your employer in the private-sector has one. How do you find out? Just ask if they have a 401(k) plan. If it’s a yes, then ask how long before you can join. Most companies will require you to be employed one year and work 1,000 hours per year to be eligible to participate. This equates to an average 20-hour workweek. If your employer does not have a 401(k) plan, ask them if they plan to offer one in the future. Some companies simply choose not to sponsor a plan, and other simply have not contemplated it. Like most employer benefits there is a cost to the business. The average fee to establish a 401(k) plan is about $500 and the annual cost of administration hovers around $1,500 per year depending on number of employees. If you are self-employed and reading this, there are several options of low-cost retirement plans available to you with no establishment fees or annual administration fees.

      A common misconception in the workplace is that your employer gets something from you by you joining their plan. Nothing could be further from the truth. 401(k) plans are an employee benefit provided at a cost to employers. They gain nothing from you by sponsoring a 401(k) plan, except for a ton of responsibility and some bills. Employers typically sponsor a plan so the owners can fund their own retirement,

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