Break from the Grind July 14, 2016

A Little Friday File Fun

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In Guelph, Ontario, Canada, a police officer saw what looked like a bicycle light heading northbound on a street, but as the light approached, the officer realized the light was coming from inside a motor vehicle. The vehicle was speeding, and as it passed the police cruiser, the officer noted it had no working exterior lights. According to CBC News, the officer stopped the car and “found the driver to be wearing an LED headlamp on his forehead,” police said.

In Mary Esther, Florida, a woman was taken to the hospital for evaluation after crashing her car into a home. The woman told Okaloosa County Sheriff’s Office deputies she was praying at the time and had her eyes closed, according to the Northwest Florida Daily News.

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In Vista, California, a sheriff tried to pull over a driver for a minor traffic violation, but instead of stopping, the driving kept going. According to the San Diego Union-Tribune, the driver meandered through the city for nearly 20 minutes before stopping in the jail parking lot. He ran from the car and clambered over a fence into the jail intake area, where prisoners are driven in for booking, a sheriff’s official said. Easy arrest.

In Chongqing, China, a man met a woman online and found out she has a great admiration for policemen. To impress her, he took her to the local police station, saying he was the police chief. According to the Shanghaiist, before the policeman on duty had a chance to ask who he was, the man said, “Brother, you don’t know your new police chief? Must be because I was only transferred here last week. I’ve been training elsewhere, and haven’t met everyone here yet.” He then asked the policeman to bring his guest a cup of water, and declared that there will be a meeting that night during which he will introduce himself to everyone. The policeman he talked to thought this was odd, so he asked his group leader about this change in leadership, who assured him that there was none. Realizing that there was a fraud in their midst, he detained the imposter, who quickly admitted to his crime.

You know the Pokemon Go craze is getting out of hand when a weather report is interrupted.

If you can't view the below video, try https://youtu.be/bOITDtJhQ1o

In Christchurch, New Zealand, a kebab shop owner thwarted a would-be robber’s plans by just ignoring him.

If you can't view the below video, try https://youtu.be/m4oW5gyxQg0

Investing July 14, 2016

401(k) Plan Participants Invest in Lower-Cost Mutual Funds

ICI reports the cost of investing in equity mutual funds through 401(k) plans has declined 31% since 2000.
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401(k) plan participants tend to be invested in lower-cost mutual funds, the Investment Company Institute (ICI) finds.

At year-end 2015, 89% of mutual fund assets in 401(k) plans were held in institutional and retail no-load share classes, while the remaining assets were held in load share classes, predominantly in share classes that do not charge retirement plan participants a front-end load.

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The cost of investing in equity mutual funds through 401(k) plans fell again in 2015, marking a 31% decline since 2000, according to annual research from ICI. The study report, “The Economics of Providing 401(k) Plans: Services, Fees, and Expenses, 2015,” notes that a separate ICI survey found mutual funds comprise 60% of the $4.7 trillion in 401(k) plan assets at year-end 2015.

The average expense ratios that 401(k) plan participants incurred for investing in equity, hybrid, and bond funds fell in 2015 for the sixth straight year. For equity funds, 401(k) plan participants incurred an average expense ratio of 0.53%, which was less than the asset-weighted average expense ratio of 0.68% incurred by all investors in equity funds and less than half the industrywide simple average of 1.31% for all equity funds offered in the United States in 2015. The average expense ratio that 401(k) plan participants incurred for investing in hybrid funds fell to 0.54% in 2015, compared to 0.55% in 2014. And the average expense ratio that 401(k) plan participants incurred for investing in bond mutual funds fell to 0.38% in 2015, from 0.43% in 2014.

“The data underscore the significant trend of declining fees since 2000 that 401(k) plan participants have paid to invest in mutual funds,” says Sean Collins, ICI’s senior director of industry and financial analysis. “There is a vibrant and competitive market for investors to shop among mutual funds and other investment products, which has fueled the trend in declining fees to the benefit of investors.”

ICI concludes that numerous factors contribute to the relatively low expense ratios incurred by 401(k) plan participants investing in mutual funds, including:

  • competition among mutual funds and other investment products to offer shareholders service and performance;
  • plan sponsor decisions to cover a portion of 401(k) plan costs, which allow them to select lower-cost funds or share classes;
  • economies of scale, which large investors such as 401(k) plans can achieve;
  • cost- and performance-conscious decisionmaking by plan sponsors and plan participants; and
  • the limited role of professional financial advisers in these plans.

The study report is at https://www.ici.org/pdf/per22-04.pdf.

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