Transparency's big right now. In fact, I can't remember hearing this much about it since the advent of Scotch Tape. (Sorry, I'm still wrapping presents.)
Seriously, though, it's one of those rare industry-coined terms that actually manages to transcend the market and lodge itself in the mainstream vernacular. Politicians love to espouse the promised land of transparency from the stump, but rarely do much to encourage it in the trenches.
The Bush administration jumped aboard last week with their announcement of support for full disclosure of 401(k) fees. The administration proclamation backs a recent Labor Department proposal that aims to "foster fair, competitive and transparent prices for services as well as combat excessive or hidden plan fees."
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Is this a big deal? Well, according to the Government Accountability Office, roughly 80 percent of 401(k) plan investors have no idea how much fees are whittling away at their account balances. And according the Capitol Hill politicos, a 1-point difference can cut into retirement accounts by nearly 20 percent.
So, yeah, we're talking about some potentially huge numbers here. And, while this entire issue appears to be a no-brainer at first blush, the Bush administration support looks like a purely (safe) political move.
It's also worth pointing out that this presents another classic case of a lack of self-regulation drawing the attention of zealous regulators and ambitious politicians. It bears repeating: If we want Washington to stay out of our problems, we need to fix them ourselves.
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