Yale Professor Shaking Up the Retirement Industry

Nowthat the Labor Department has required 401k plans to report fees to retirementsavers, Yale researcher Ian Ayres is planning to publish fund fees comparisonsof thousands of 401k plans.  ProfessorAyres isn’t doing this merely for the sake of academia; he’s sending letters to“high cost” plan sponsors demanding they change their practices and offerlow-fee products or end up being identified as “high cost” in his research.

Thisplan has the retirement industry up in arms with investor lawsuits andCongressional hearings soon to be expected. Afraid of this unwanted publicity, plan advisers are calling ProfessorAyres’s tactics “harassment.”  Thisreaction is understandable as a plan comparison would beg “the uncomfortablequestion of why high adviser fees don’t necessarily correspond to betterperformance.”

See Mitch Tuchman, Meet the Yale Prof Ripping the Lid Off 401k Fund Fees, Forbes, July26, 2013.