Should 401k Plans Offer Only Index Funds?

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By Robert C. Lawton, President, Lawton Retirement Plan Consultants, LLC

A number of retirement plan experts believe that 401k plan participants should only be allowed to invest in index funds. They say the additional cost that participants pay for actively managed mutual funds is not justified by better performance. Some 401k plan sponsors have agreed, offering only index funds in their fund lineups. Is that a good idea?

Arguments For Using Only Index Funds

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Six Keys To Investment Success: T. Rowe’s Brian Rogers Reflects

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I hope you had a wonderful weekend! Remember Valentine’s Day is tomorrow!

LRPC’s Monday Morning Minute for this week, “Six Keys To Investment Success: T. Rowe’s Brian Rogers Reflects” (presented below) comes to you courtesy of ThinkAdvisor. As an independent, objective Registered Investment Advisory firm, Lawton Retirement Plan Consultants, LLC has access to research from many sources. Be assured that I will share enlightening, useful information with you each week. This is a short piece I believe everyone can read in less than 60 seconds.

As his retirement approaches, Brian Rogers, Chairman and CIO at T. Rowe Price, shares his knowledge gained from 35 years working with investments.

Have a wonderful week!

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Six Keys To Investment Success: T. Rowe’s Brian Rogers Reflects

By Emily Zulz, Staff Reporter, ThinkAdvisor

On Brian Rogers’ desk at T. Rowe Price is an engraved cube displaying the reminder, “Doubt everything. Believe nothing.” “And I think those are good things for investors to do,” as well, Rogers said

As the time nears for him to step down from his current roles as chairman and CIO at T. Rowe, Rogers is taking time to reflect on his career. “One thing that really struck me” in 1982 when he joined T. Rowe, he recalled at the event, is how “passive was making increasing inroads into our business.” In addition, he said, “fees were under cyclical pressure in 1982. Fast forward to 2016 and it feels like the same two trends are in place, and will continue.”

Recently, T. Rowe Price announced that Rogers will retire as chairman and CIO on March 31, 2017, after nearly 35 years at the firm. While he will stay on as a non-executive chair, his role as CIO will be taken on by six senior investment executives. Recently, Rogers shared six keys to investment success he’s learned over his career. [Read more…]

Six New Year’s Resolutions 401k Plan Sponsors Should Make

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By Robert C. Lawton, AIF, CRPS, President, Lawton Retirement Plan Consultants, LLC

I hope that 2016 was a great year for you and that 2017 will be even better!

A few changes can make your good 401k plan into a great one. To help your 401k plan achieve greatness, consider making the following 401k plan improvements by year-end: [Read more…]

The Five Deadly Sins Of Investing

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I hope you had a great weekend! Time’s running out for you holiday shoppers!

LRPC’s Monday Morning Minute for this week, “The Five Deadly Sins Of Investing” (presented below) comes to you courtesy of ThinkAdvisor. As an independent, objective Registered Investment Advisory firm, Lawton Retirement Plan Consultants, LLC has access to research from many sources. Be assured that I will share enlightening, useful information with you each week. If you are short on time, make sure you take a look at each of the five headings below.

Sometimes the best way to improve how you invest is to learn what not to do. This week’s article outlines some of the biggest investing mistakes all investors should avoid.

Have a wonderful week!

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The Five Deadly Sins Of Investing

By Daniel S. Kern, appearing in ThinkAdvisor

One of my friends in school was renowned for frequently telling us: “I aced that test!” He was never shy about sharing his answers after a test. His certainty about the answers made me question whether my answers were correct.

I eventually realized that he was wrong more often than right, and he became notorious for misplaced self-confidence. When he joined an investment firm after graduating from school, some of us joked about starting a “contrarian” fund to bet against his stock picks. Overconfidence is one of the “deadly sins” highlighted in studies of behavioral economics.

The investment industry is filled with confident people similar to my friend, who may be well-meaning but who also pass along bad ideas that become accepted as conventional wisdom. Here’s my top five list of investing mistakes that become deadly sins of investing: [Read more…]

Socially Responsible Investing Ratings Can Boost Your 401k’s Value

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By Robert C. Lawton, AIF, CRPS, President, Lawton Retirement Plan Consultants, LLC

Recently Morningstar, creator of the Morningstar Star Ratings for mutual funds, introduced Sustainability Ratings to gauge an investment’s adherence to SRI principles. 401k plan participants, millennials especially, have become interested in socially conscious and impact investing. A recent U.S. Trust survey found SRI factors are important to 93% of millennials when making an investment decision. Your 401k plan can have greater value to your employees if you begin sharing Morningstar’s Sustainability Ratings for your 401k investment options. [Read more…]

Did You Hire The Right 401k Investment Adviser?

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By Robert C. Lawton, AIF, CRPS, President, Lawton Retirement Plan Consultants, LLC

As a 401k plan sponsor, you are probably aware that there are some new fiduciary regulations going into effect in April of 2017. You probably have spent some time wondering (worrying?) whether these regulations affect your relationship with the investment adviser or investment advisor who works with your 401k plan. They might. Here’s how to tell. [Read more…]

How To Hire A 401k Investment Adviser

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By Robert C. Lawton, AIF, CRPS, President, Lawton Retirement Plan Consultants, LLC

Employer plan sponsors often ask me which investment adviser credentials are most important to look for when hiring a 401k investment adviser. As a 401k investment adviser myself, I have observed a number of plan sponsors hiring the wrong advisers because they aren’t looking at the right investment adviser credentials and are using an incorrect set of criteria to judge who is best.

Following are some universal, common sense criteria that plan sponsors can apply when hiring a 401k investment adviser along with important investment adviser credentials to evaluate. The information is divided into what I would consider the three major categories plan sponsors should evaluate: Fiduciary Responsibility, Firm and Background. [Read more…]

What Plan Sponsors Need To Do NOW In Response To 401k Money Market Fund Rules

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 By Robert C. Lawton, AIF, CRPS, President, Lawton Retirement Plan Consultants, LLC

The large mutual fund families are doing everything possible to keep you from moving your 401k money market investments away. BlackRock, Federated, Fidelity and Vanguard have all announced changes to their money market fund offerings which they hope will allow them to retain existing 401k money market balances. These changes are in response to the Securities and Exchange Commission (SEC) 401k money market fund reform rules outlined below. [Read more…]

After Reaching New Highs, Can Stock Market Rally Continue?

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MMM Newsletter and Website Header 10.2.15I hope you had a great weekend! Training camps are open and football is back!

LRPC’s Monday Morning Minute for this week, “After Reaching New Highs, Can Stock Market Rally Continue” (presented below) comes to you courtesy of Charles Schwab. As an independent, objective Registered Investment Advisory firm, Lawton Retirement Plan Consultants, LLC has access to research from many sources. Be assured that I will share the most relevant information with you each week. This is a short piece I believe everyone can read in less than 60 seconds.

Where does the U.S. stock market go from here? Are more new highs in the offing, or is a correction just around the corner? See what the experts from Schwab have to say below.

Have a wonderful week!

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After Reaching New Highs, Can Stock Market Rally Continue?

By Schwab Newsroom

It took 14 months and some rather unnerving dips along the way, but U.S. stocks finally climbed to new highs in July. The path ahead could be just as fraught. Stocks could still grind higher in the coming months, but there will likely be more moments that test your resolve.

“Volatility will continue to be elevated, but at this point we believe the U.S. economy should continue to show modest growth, helping to support similarly modest gains for equities,” says Liz Ann Sonders, senior vice president and chief investment strategist at Charles Schwab.

Here’s what you need to know about the market’s ascent and what could lie ahead for investors: [Read more…]

401k RFP Tips For Employers

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By Robert C. Lawton, AIF, CRPS, President, Lawton Retirement Plan Consultants, LLC

Recently my Registered Investment Advisory (RIA) firm has been fortunate to receive a number of Requests For Proposals (RFPs) for investment advisory services. While I am grateful to receive these RFPs, I continue to be puzzled by how some plan sponsors choose to manage their RFP process. So, outlined below, I have provided some tips on how plan sponsors can optimize their 401k RFP process to ensure it produces the best possible result. [Read more…]