h/t Paul Buchheit
Based on the 6% historical stock market return, an individual investing $1,000 a year for 30 years in a non-fee fund and then holding the accumulated sum for another 20 years would end up with $269,000. Imposing the industry average 1.3% fee would reduce the final total to $165,000, a 39% reduction.
In other words, almost $2 of every $5 in potential 401(k) earnings is lost because of bank fees.
The importance of preserving Social Security becomes even more apparent in light of this 401(k) exploitation. Since 1983, the number of private sector workers depending on a 401(k) instead of a company pension has increased from 12 percent to 68 percent.
An out-of-town guest was given a tour in New York. The guide pointed out the beautiful yachts in the harbor and said “Look, those are the bankers’ and brokers’ yachts.” The guest asked “Where are the customers’ yachts?”