The plans in public school districts — often a “laissez-faire” type of arrangement exposing teachers to high-fee products — won’t be helped by the new regulation.
By Greg Iacurci
Through its fiduciary rule, the Department of Labor is attempting to rein in conflicted investment advice and reduce costs for retirement savers.
However, there’s a corner of the retirement market plagued by the sort of high fees and sales practices the DOL is attacking that won’t be touched by the regulation: public school districts.
403(b) plans, a type of defined contribution plan for public schools, tax-exempt organizations and ministers, are notorious among advisers and industry practitioners as being a sort of free-for-all environment with multiple vendors, high-fee investment products and brokers who can camp out in a school cafeteria to try to make a sale. Read More…