GAO warns 401(k) savers

“Beware of administrators pushing funds. Anyone who has a 401(k) should be cautious if the investment firm running the plan offers “education,” because this kind of advice could be little more than a sales pitch. Investment companies are legally prevented from promoting funds for which they receive a special sales incentive. But the report said that doesn’t prevent them from subtly promoting funds that are particularly profitable for them. They do it by urging savers to invest in a certain type of fund and then only offering one or two choices. The GAO said in the report released Monday: “Participants who confuse investment education for impartial advice may choose investments that do not meet their needs, pay higher fees than with other investment options, and have lower savings available for retirement.”

Source:  Bankrate.com

What does the U.S. Governemnt Accounting Office know anyway!

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