Ian Ayres on 401(k) anti-services:
“An anti-service is when you deliver lower quality services
in exchange for charging higher prices. Plan advisors often defend their
fees by claiming that they educate employees about the importance of retirement
savings. Retirement products, they claim, are “not bought, but sold.”
They say they need to be paid more to have the resources to credibly educate
workers about the benefits of participating. But of course it’s also easy
to see why higher fees could discourage participation – demand tends to go down
as prices rise. Higher fees causing lower participation would be an
anti-service.”
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for the full column by Ian Ayres in Forbes.