I will be hosting a weekly radio show based on the premise that for the last 25 years, Americans have been sold a destructive system of personal money management—a system that never worked and never will. It's time for an approach that works. It’s time to spend smart, invest successfully and live the life you want. That’s Money Smart Radio.
The bigger picture is a monumental tug of war between the huge, unresolved, real world problems our economy is facing and the self-serving "things are good" spin from the financial services industry and, until now, from our government. We are facing huge unresolved economic problems that have been building for 15+ years and that our government cannot solve- problems with jobs, housing, burdensome government regulation and mountains of consumer, corporate, and government debt that must be wrung out, and painfully, in the real world. News like today's should be taken as a reminder and a motivator to put your own financial house in order.
No one including Morningstar can reliably identify which mutual funds are likely to outperform the market, let alone match it, and so Index Funds are the best way to invest in the stock market.
The problem with the Morningstar rating system is that strong short term fund performance is meaningless since the majority of the 4-5 star funds drop to 3 stars or less within a few short years. When the ratings drop, investors are advised to invest their money in the next set of 4-5 star funds. The result is both investment underperformance and additional losses from paying the substantial commissions required by the fund switch. This cycle is extremely damaging and yet is the norm.
Financial expert, Ted Hunter provides investment advice that when investing in the stock market, no-load index funds are commission free, have very low trading and other costs, and will by far provide the very best return on your investment. Use them to manage your money.
So where did everyone's retirement money go? It went to pay for the multi-billion dollar financial services industry. It was lost due to gross investment incompetence by an industry that doesn’t know how to invest successfully, but does know how to successfully sell the idea that they do. Americans have been subjected to one of the most effective and most destructive marketing campaigns in history.
