Money is an integral part of the world. Since it is such an important aspect, it would do well to know more about it, but many people are lost in the terminology that comes along with finance. I really didn’t know what it was all about, nor was I concerned about it because I figured I wouldn’t have to worry about it for another few years. However, the least we could do is know the terminology so that when the time comes to put it into use or it comes up on the news, we know what they are talking about. John Oliver is good at presenting an issue, explaining why it should concern us, and telling us what can be done about it so we can help ourselves. The review on U.S Pirg over the John Oliver retirement episode, was very informative and was able to walk me through the issues people of retirement age face when being taken advantage by non-fiduciary brokers. They are not told what exactly it is they are investing in and usually what the broker does invest their client’s money in, tends to benefit him/her rather than the clients, gaining commission and splurging. Terms that are important to know are:
- Fiduciary rule: legal term for a broad group of professionals who are required to put customers’ interests first. They cannot accept compensation or payments that would create a conflict of interest (Lee).
- Hedge funds: highly active funds with very high costs
- Index funds: A list of stocks are bought and you receive the average return for that class of stock from that particular index you chose.
- Best Interest Contract Exemption (BICE): a full disclosure contract under the fiduciary rule (Tucker). Ensures that investors know exactly what it is they are investing in.
Lee, K. (2016, June 14). Blog. Retrieved November 09, 2017, from https://uspirg.org/blogs/blog/usp/last-week-tonight-john-oliver-retirement-industry-minefield-here%e2%80%99s-answer
Tucker, P. (n.d.). 4 Arguments Against the Fiduciary Rule Debunked. Retrieved November 09, 2017, from http://www.truemeasureadvisors.com/2016/04/20/20164145-argument-against-the-fiduciary-rule-debunked/