Benefits April 28, 2011

Most 401(k) Participants not Aware of Fees They Pay

April 28, 2011 (PLANSPONSOR.com) – In a recent survey by AARP, more than seven in ten (71%) 401(k) plan participants incorrectly reported that they do not pay any fees to plan providers.
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Less than a quarter (23%) said they do pay fees, and less than one in ten (6%) stated that they do not know whether or not they pay any fees, according to a press release.  

About three in five (62%) are unaware of how much they are paying in fees for their plans, and almost one-third (32%) report that they do not feel knowledgeable about the impact that fees could have on their retirement savings.    

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However, about four in five (81%) believe that the fees charged for investments are very important or somewhat important in decisions about their 401(k) investments.  

Other findings include: 

  • While most plan participants (63%) say they have contributed money to their 401(k) plan, about one-fifth (22%) have withdrawn money or received payments from their 401(k) plan.  
  • Almost two-thirds (64%) stated that they prefer to make their own decisions about saving and investing.  Some respondents reveal that they have taken steps to learn more about their investments such as using the summary information or prospectuses about mutual funds or consulting with a personal financial adviser.  
  • When respondents were asked how confident they are about having enough money to live comfortably throughout their retirement years, almost three-quarters (74%) stated that they are very confident or somewhat confident.   
  • Most respondents (64%) report that they have tried to calculate how much money they will need to have saved by the time they decide to retire so that they may live comfortably in retirement.  

  

The survey was conducted from December 14 through December 30, 2010 by Woelfel Research, Inc. among a sample of 803 U.S. residents ages 25 and over who are 401(k) plan participants.  

A full survey report can be downloaded from here.
Products April 28, 2011

UBS Offers ETN Linked to Business Development Company Index

April 28, 2011 (PLANSPONSOR.com) - UBS Investment Bank announced that it has added to its suite of E-TRACS Exchange Traded Notes (ETNs) an E-TRACS linked to the Wells Fargo Business Development Company (BDC) Index.
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The new ETN began trading on NYSE Arca under the ticker symbol BDCS.  

UBS explained in a press release that BDCs are public vehicles that invest in private equity and debt and were created to increase financing available to small businesses. They function much like private equity funds, although BDCs allow various investors, regardless of size, to participate. A BDC lends to small and midsized companies at high yield equivalent rates and often takes equity stakes in these companies.   

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The Wells Fargo Business Development Company Index is comprised of 26 BDCs and is a float adjusted, capitalization-weighted index that is intended to measure the performance of BDCs that are publicly listed, satisfying specified market capitalization and other eligibility requirements.  

More information is at http://www.ubs.com/e-tracs.

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