Recovering Your Mutual Fund Losses

Boston, MASo, you have just received word that your mutual fund losses are staggering. Your fund manager either did not recognize that there were problems with the fund, or did recognize problems but failed to act quickly enough to protect you from further declines in your mutual funds. Luckily, you can count on mutual fund ERISA regulations to help protect your money when your mutual fund manager did not.

If you are like the average mutual fund investor, you probably are not entirely savvy about the whole mutual fund market. In fact, you may have simply turned your money over to the fund manager and hoped for the best. If so, you are not alone. Many people do not fully understand the ins and outs of investing in mutual funds. Add to that the myriad investing options and there is a lot of information for one person to take in.

After all, you are probably not counting on mutual funds to be your sole source of income. Rather, they are a way for you to save money for your retirement or to pay for your child's education or for some extra money. Your mutual funds are for extra money, but not your main income. You work hard, very hard, for the money that goes into those mutual funds, and you put the money into those mutual funds based on the advice given to you by either your financial advisor or the fund manager.

So, you were stunned to learn that your mutual fund lost as much as it did, especially since you thought you had no reason to worry. You were told that mutual funds were a way for the average person to get involved in investing without all the drama of the stock market (and who needs that up-one-day-down-the-next rollercoaster?). With the mutual fund your money is managed for you, by a professional money manager whose job it is to make sure you get the most from your mutual fund.

Except that sometimes the fund manager fails to act in his clients' best interests. He may make decisions that are based on personal interest or that go against what is prudent for his investors. The problem is that he is playing with other people's money—and those people deserve to have their interests represented.

Your losses may not be the stuff of news headlines, you may not have lost millions of dollars, but you lost money due to someone's negligence and that is unacceptable. You lost more than you could afford to lose—you lost money that was supposed to help you out during retirement. You lost money that you worked hard to save—maybe you budgeted for years so that you would have a few extra pennies to put into your mutual funds. Now you find out that you do not have that money after all.

So, what do you do now? Well, a good place to start would be to contact an attorney to discuss your legal options. A lawyer can help determine if your losses were just an unfortunate result of the economic downturn or if there was actual negligence involved in the managing of your fund. If there was negligence, then you may be able to recover your lost money. It is not the ideal situation to be in, but at least you can recover some of the money that you lost because someone failed to act in your best interests.