The Retirement Gamble.

Watch this video from Frontline. You may need to explore more of the web site to find answers to the questions below.

http://www.pbs.org/wgbh/pages/frontline/retirement-gamble/

Answer these questions on a sheet of paper. Use complete sentences.

1. What are some factors that keep people from saving as much as they should?
2. What role does the financial services industry play in keeping people from retiring with as much money as they should?
3. What is expense ratio? How is it used to calculate dollar amount expenses?
4. How much does a typical investor pay in fees? You may find more info in the following link:

 http://www.investopedia.com/articles/stocks/08/fees-commission-value.asp

5. What mistake do most people make when the market drops in value?
6. Who is John Bogle and what radical idea did he bring to the market?

http://www.pbs.org/wgbh/pages/frontline/business-economy-financial-crisis/retirement-gamble/index-funds-the-key-to-saving-for-retirement/

 Look up the current stock price of the Vanguard 500 Index fund here

http://money.cnn.com/quote/mutualfund/mutualfund.html?symb=VFIAX

What is the expense ratio of this fund and how does it compare to the industry average?

Assignment: Calculate your lifetime returns using the returns of the Vanguard 500 less the expense fees. Compare the expense fees of this fund to the industry average. Assuming that you invest 300 per month, what is the amount of money you save compared to the industry average?