Failing Fund Managers
Phil Town talks about what has happened to everyone's retirement money in the last couple of years. He wonders if it wasn’t enough to prove to you the futility of the mutual fund investment industry. Phil Town states that as a fact: You have been brain- washed out of your hard earned retirement savings by the very system into which you were putting your trust. That seemingly old trusty institution called the 401(k) you’re using to build up your nest egg with capital is just not working is it? They are not catering to your retirement out of loving concerns.
Mr. Phil Town says that the main beneficiaries of the investments in your retirement plans are the very people who created these funds: the fund adminis-trators and managers. They’ve set up the system so that, in the end, they’ll windup with almost 2/3rds of your hard earned investing money. You thought they were only taking a little bit from your paycheck each month. Nope. You didn't know all this did you? Is this a failing system?
These fund managers are in the mutual fund business because it makes them rich without having to be very competent or skilled. They either don’t have the skill set necessary to successfully load up on successful businesses or they don’t have the luxury of time to wait for a great opportunity to stockpile. Yet Americans give them their hard earned savings—your hard-earned money mindlessly year after year. The Mutual fund managers, in turn, slash and deplete that pile of money that belongs to you.
Shouldn't you know what they are doing with your money and what they are responsible for. You’re paying for the privilege of active management. That means that you’re paying someone to use their best judgment every day to put your money to work for you. You expect them to get you a high rate of return in the long run. That fund manager is expected to get you out of undervalued stocks before they price goes down,…right? They are suppose to get you into great value stocks at the a really good price. After all, that’s the whole purpose of active management. If all he was going to do was match market returns, then there is no real purpose to active management, right? You’d be spending your money on something and getting nothing for it.
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