The following headline is way too common today.
“Between July 29 and Aug. 2, lawyers representing current and past participants in six separate retirement plans filed suit against their employers and plan fiduciaries, charging that the BlackRock target-date funds in the plans performed worse than other popular target-date funds.”
I lost money in my 401 K plan. Your selection of funds was not in my best interest. You charged unreasonable fees. There were better funds that you could have chosen……and the list of complaints goes on.
Are employers and plan fiduciaries totally 100% responsible for the performance of their fund selection? It is as if the employee has no responsibility at all. Is an employee not held to a standard of due diligence? Do employees not have to do their homework? If they go to their financial advisor, is their advisor responsible for the results of the funds he or she recommended?
Then for the biggest question of them all –
Are employers and plan fiduciaries supposed to be able to forecast and predict the future with 100% accuracy?
Having said that, if the employer benefited personally at the expense of the employee’s participation in the 401 K plan, then there definitely should be repercussions.
It just seems like this is not the case in these lawsuits. Welcome to the country of entitlement! -where there are no consequences for your actions, only the actions of those who provide choices for you.
Let’s just hope that the Judge hearing these cases doesn’t set dangerous precedents.
Check out Bob's teaching videos at youtube.com/user/prudentmoney to learn more on intentional financial stewardship.
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