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This Week 401(k)s With Plan Fees, You Get What You Pay For: Execs ................1
Collective Trusts Gain Popularity Among Sponsors ..........1 Mutual Funds Industry Rallies Around Cancer Research Charity ................1 Editors Desk Enough Already About 401(k) Debit Cards .............................3 Executive Moves Jenrette on Blackstone Board ......4 At Deadline Retirement Assets Near $18T ........4 Week in Review Labor Dept. Proposes Clear Disclosure on 401(k) Fees ...............6
Barclays Plans ETFs Based on Target Dates .....................7
eSecLending Forms RIA ..................7 By John Morgan BOSTONExcessive fees in some 401(k) plans are hurting the reputation of all 401(k) plans and shaking investor confidence in what most financial experts agree is a great way for
the majority of Americans to save for retirement. There is a notion in the press that 401(k) inves- tors are being hosed. This is not the case, said Michael Hadley,
the Investment Company Institutes associate counsel for pen-
sion regulation, at the Defined Contribution Investment Only
Forum, held last Monday and Tuesday at the Harvard Club, and
hosted by Financial Research Associates. 401(k) investors are
getting an incredible deal. The problem, Hadley said, is that the Department of Labors Fund Execs Defend 401(k) Fees Execs Call Some Fees Extraneous, Others Advantageous 401(k) FEES, cont. on page  Reproduction or electronic forwarding of this product is a violation of federal copyright law! Site licenses are available - please call Customer Service at 1-800-221-1809 or custserv@sourcemedia.com Impressive Strides by Funds Against Cancer Charitable Group, Having Raised $800,000 Already This Year, Is on $4 Million Track By Esme Nicholson PLYMOUTH, Mass.The bewildered looks on the faces of young patients in the childrens ward of the Dana-Farber Cancer Institute
were wrenching enough. For Frank
Strauss, who had himself become a
parent in 1995 to his first child, Nicole, only three months before, the helplessness etched
on their parents faces was far worse. Having to walk through this scene every time he went to visit his mother, diagnosed with leukemia
at the young age of 54, was devastating. Eventu-
ally, though, as Strauss mother, Sandra, regained
strengthshe remains in remission today, as one in MFAC, cont. on page 10 United States Europe 2001 2003 2005 2007 60% 50% 40% 30% 20% 10% 0% European & U.S. Mutual Funds: Share of the Worldwide Market (Percentage of Assets) Europe is slowing but steadily gaining on Americas worldwide market share of mutual funds. Source: Investment Company Institute, European Fund and Asset Management Association, Grail Partners 401(k) Plans Move To Collective Trusts CITs Offer Lower Fees, But Less Transparency By John Morgan BOSTONWorkers love pension plans, but providing 20 to 30 years of benefits to a huge retired workforce can cripple most
companies profits. As more firms drop their defined benefit pension plans in favor of defined contribu-
tion 401(k)s, institutions are looking for qualified
default investment alternatives to mutual funds,
such as collective investment trusts (CITs) and
separately managed accounts (SMAs), to provide
employees with pension-like features. You want to have the best tools available to meet your goals and give your participants the best plan
available, said Thomas Waters, managing director COLLECTIVE TRUSTS, cont. on page  Mutual Funds 401(k)s Paul Powell 401(k)s money management executive The Premier News Source for Asset Management Leaders July 28, 2008 | Volume 16 Number 30 | www.mmexecutive.com | feedback-mme@sourcemedia.com July 28, 2008 Money Management Executive  Editors Desk 401(k) Debit Cards: Dumb and Dangerous By Lee Barney Its bad enough that 40% of workers in their
20s and 30s cash out
their 401(k)s when they switch jobs, even though taxes and
penalties decimate the balances to al-
most half, according to a CMI survey
of 1,200 people in January commis-
sioned by Fidelity. Worse, even, a small percentage of 401(k) participants take out loans
or hardship withdrawals from their
retirement savings, which average
only $122,000 in the first place, with
a national median balance of $66,000,
data from the Investment Company
Institute and the Employee Benefit
Research Institute shows. Now Congress is debating the pros and cons of supplying people with
401(k) debit cards. Are they serious? Putting this piece of plastic in investors hands would be
akin to telling them to live for today
and go out and spend whatever money
theyve saved for retirement. The Reserve, one of the few com- panies in the nation that offers such
debit cards, testified before the House
of Representatives that having acces- sibility to their money would actually
encourage more people to contribute
to their 401(k)s because they dont like
giving up control over access to their
money in the first place. Easy access for needs of today cant be a sales pitch to Americans to contrib-
ute to their retirement savings. Hope-
fully, the entire discussion about 401(k)
debit cards will end in the hallowed halls
of Congress and the pages of this and
any other industry publicationand
the publicity will end there, because as
it is, many people dont even know they
can borrow up to $50,000 at an average
rate of 8% against their 401(k). Meanwhile, last week, a company that provides rollover assistance to
individuals called RolloverSystems,
posted a calculator in its website to
dissuade people from cashing out of
their 401(k)s by showing them how
much money today could accrue to
money tomorrow. A 30-year-old, for instance, who withdraws a plan balance of $20,000
would get socked with $8,000 in tax-
es and penalties. Instead, letting the
$20,000 grow at an annual growth
rate of 8% a year for the next 40 years
would build a nest egg of $434,490. This is the message we need to get out. Not spend today, regret it
tomorrow. MME One State Street Plaza, 27th Floor New York, NY 10004 Phone: 212/803-8200 Fax: 212/803-1592 www.mmexecutive.com Lee Barney - elizabeth.barney@sourcemedia.com 212/803-8751 Editor John Morgan - john.morgan@sourcemedia.com 212/803-8728 Associate Editor Lori Pizzani - dapizzanis@aol.com 845/279-8140 Editor-at-Large Mary Ann Tasoulas - matasoulas@aol.com Copy Editor Esme Nicholson, Brooke Perrone, Alexander Spanos - Interns Ethan Byun - ethan.byun@sourcemedia.com Associate Art Director Sharon Pollack - sharon.pollack@sourcemedia.com Executive Director of Creative Services Stacy Ferrara - stacy.ferrara@sourcemedia.com Executive Director of Manufacturing Naphtali David - naphtali.david@sourcemedia.com 212/803-8680 Associate Production Manager Robert Han - robert.han@sourcemedia.com 212/803-6551 Marketing Manager Denise Petratos - denise.petratos@sourcemedia.com 212/803-6557 Manager, Reprint/Web Rights Jessica Silveira - jessica.silveira@sourcemedia.com 212/803-8761 Associate Director of Circulation Sales Ashley Johnson - ashley.johnson@sourcemedia.com 212/803-6075 Advertising Coordinator Customer Service 800/221-1809 custserv@sourcemedia.com Adam Reinebach - adam.reinebach@sourcemedia.com 212/803-6555 Publisher Naz Bayazit - naz.bayazit@sourcemedia.com 212/803-8638 Associate Publisher Louis Fugazy - louis.fugazy@sourcemedia.com 212/803-8773 National Account Manager James M. Malkin Chairman & CEO William Johnston Chief Financial Officer Jeff Scott President, Banking Group Hugh Jones President, Accuity Richard Antoneck Vice President, Finance Steve Andreazza Vice President, Sales & Customer Service Celie Baussan Senior Vice President, Operations Anne OBrien Executive Vice President, Marketing & Strategic Planning Ying Wong Senior Director, Human Resources Subscriptions: Domestic rates: Annual $1750; 2 year $3150. Foreign rates: Annual $1850; 2 year $3350. Multiple subscription rates available. Postmaster: Send address changes to: One State Street Plaza, 27th Floor, New York, NY 10004. Copyright Notice:

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