I haven't posted in awhile, but I knew just where to go for advice! (I'll be back more frequently going forward)
I received the letter from Vanguard regarding my 403b account, as has recently been discussed on here. I'm just not sure what to do about it, and I could really use some advice. OMNI charges me $3/month to use Vanguard, and Vanguard charges me $15/year to invest in a Target Date Fund. I decided $51/year in fees (on top of expense ratios) was worth it for the privilege of having access to Vanguard, since most of the offerings from my district are not as good. I imagine the OMNI fees won't be going away, so the partnership with Newport looks like it will raise my fees from $51/year to $96/year.
I only started investing last year, and I only have $2100 in my Target Date Fund. It looks like this fund does not have access to Admiral funds, so if I stay with Vanguard I will need to exchange these for something else to take advantage of the switch to Newport. It feels a little foolish to stay with Vanguard, however, since a much larger portion of my gains will be consumed by fees. But, given that it is a 403b, taking the money out before retirement seems like a no-go. Are my first year's contributions simply held hostage now?
Here are my options, as I see them. I have no idea what to do next, and I would love some guidance:
1) Keep the status quo, pay more in fees.
2) Stay with Vanguard, but switch into something that has admiral class shares. I don't want to use a managed fund. Higher fees remain, but hopefully I will pay less in expense ratios that will make this more advantageous. That said, my small balance means this will be marginal at best, right?
3) Treat this as a hostage situation, and we all know that the US doesn't negotiate with terrorists. I would leave my money in Vanguard, stop contributions, and open an account with someone else to begin contributing to. The decent options that I have access to are Aspire (403b and Roth), T Rowe Price, and TIAA.
4) Stop all retirement contributions, try and save $3,000 and open an IRA sometime next year.
5) Another genius idea that only the folks at 403bwise would think of. You guys rock.
The fourth option I like because, ideally, I would like my savings to not be taxed when I withdraw in retirement. But I don't have $3,000 saved, and I am not optimistic about my ability to save it on my own. Medical bills seem to be frequent things nowadays in my household, and there will always be something important that I will need to put my savings into. Having my district take the money out before I can get my hands on it has worked well so far. The ROTH Aspire is an attractive option for these reasons, but I have access to lower-fee options than Aspire so it is difficult to go with them.
I would LOVE any advice. I am feeling stuck.