Portfolio

Although the market was hammered this month by subprime loans, individual mutual funds aren't likely to have much exposure to the volatile sector. Most subprime lenders are small-cap companies, and, as such, funds won't have large amounts of cash invested in them. In addition, most mutual funds are diversified.

Critics of 401(k) plans say they have failed the nation's workers because they don't equip them with financial advice. Although the Pension Protection Act prescribes giving guidance, it is vague on what it should constitute and, therefore, hasn't prompted many plan sponsors or administrators to provide such assistance. Without clear rules, they are afraid of fiduciary liability.

JPMorgan Finds Flaws in Target-Date Funds' Design

A bill introduced in the House of Representatives would permit employers to offer a hybrid defined benefit plan and defined contribution plan with employees receiving a single statement.

With so many surveys reiterating Americans' lack of preparedness for retirement, it's certainly good news that assets in 401(k) plans are finally growing again. However, that's primarily because the stock market performed so well in 2003, not because employers or investors are committing more money.

By definition, intangibles cannot be measured, but that's exactly what Morningstar's recently launched Fiduciary Grade system is attempting. Last week, the Chicago-based fund research and ratings firm unveiled its newest offering, which assigns a letter grade to more than 600 funds assessing how well a fund company's, and its manager's, interests are aligned with those of shareholders. Morningstar plans to extend this rating to an additional 1,500 funds.

Participants in 401(k) plans saw their account balances grow by more than 29% last year, evidence that despite a difficult bear market in previous years, investors are still turning to the vehicle as an effective way to save over the long-term. This is according to a recent study released by the Investment Company Institute and the Employee Benefit Research Institute.

Participants in Manulife USA lifecycle funds have reaped higher returns on their investment in the last five years than do-it-yourself asset allocations, a recent survey conducted by investment consulting firm Burgess + Associates shows.

Mounting evidence shows education can indeed help employees make better decisions to build retirement savings, including a recent survey by the TIAA-CREF Institute and North Carolina State University (NCSU).

The path to retirement can be a long haul, so author David Shapiro recommends using GORP: goal-oriented retirement planning. The admittedly cutesy acronym does not diminish the gravity of Shapiro's topic, funding retirement for the millions of American Baby Boomers who have not yet saved enough.