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sschullo

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About sschullo

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  1. Aspire?

    Scotty Over the years, you, Dan and I have talked to many professionals with Valic, Fidelity, Vanguard's 403b department (Dan and I had a personal conversation with Jack Bogle, who is the quintessential professional who understands how horrific the public k12 403(b) is), even a DC lobbyist for the insurance industry, Brian Graff had the courage to give a presentation of his industry's view of the 403b world to our committee (about his laughable "Project Transparency"). Our committee rejected his so-called project, and he walked out of our meeting in a huff! But guess what? In the following weeks, NEA agreed with Mr. Graff's professional organization and his unenforceable transparency project. (His presentation to our committee was recorded here: https://www.bing.com//search?q=LAUSD+Brian+graff&view=detail&mid=5DD6AB58EEC295E0D1335DD6AB58EEC295E0D133&FORM=VIRE). He is the 100% opposite of Mr. Bogle as he sees nothing wrong with the current 403b. He bragged about NEA agreement about project transparency on his organization's website. Scott, you wrote all about that experience on your blog. A great piece. None of the unions would dare engage in a conversation with us 403(b) reformers, which is understandable, but neither has Security Benefit. I don't believe SB has ever talked to you or Dan. And for good reason SB will NEVER talk publically about their view: SB sits on one of the most lucrative gold mines found: helpless NEA members forever, as long as the NEA 3.5 million members never find out the real deal, and those in their horrific 403b, how they are getting screwed and not knowing it. SB sends NEA $2+ million every year. This is what I think about everytime the low-cost direct invest discussion comes up. Its the principle of the thing that concerns me. This is my imagination as I have talked to so many of our colleagues for 20 years about how they think about personal finance. So many are totally clueless and have no chance with some of the savviest product salespeople on the planet. There are so many very clever and petty obstacles to getting to the low-cost product (that's what my free pdf book is all about, Fighting Powerful Interests). If a new teacher trips-up, just a little, trying to enroll in direct invest and they "accidentally" talks to a SB adviser, all bets are off, they will most likely be talked into the expensive 403b product. I wonder how many teachers were lucky enough to successful enroll in direct invest. I just wonder how few there are.... Steve
  2. Which 403(B) Is Best?

    Agree with Ed. I have glanced at this thread and you have gotten excellent information. Just for your comfort, not that you need any but just in case, :- ), I offer a personal experience. I have owned VG Total Stock Market and the VG Total International Stock Market for 15 years. For bonds, I have owned VG total Bond market index, but the Intermediate-term bond is fine. The questions is what percent allocation how much you want in stocks and how much in bonds? I am 70 years old so my bond allocation is about 70% and stock allocation is 30%. I also had that allocation since I was in my late 50s. For you, it should be the reverse or even more in stocks. The bogleheads.org forum (followers of Jack Bogle, Vanguard founder) has preached this 3 fund portfolio for almost 20 years. Here is a link the 3 fund portfolio: https://www.bogleheads.org/wiki/Three-fund_portfolio Below is a list what my 30%/70% portfolio returns since 2007. Hope this helps, Best of fortunes, Steve
  3. OMG! Vanguard, Vanguard and more Vanguard. Problem solved! I agree 100% with krow36! Listen to him! You are smart enough to come here and ask questions, so now you have it! I like krow36's first suggestion is to start with a target date fund, just to get started. And when you know a little more you can invest directly in those three funds he also suggested. I have 80% of my retirement nest egg which is a comfortable 7 figure nest egg in Vanguard and I own those three funds too. The three fund portfolio is very famous and a common portfolio among us do it yourselfers, all from the Bogleheads.org forum (read more about the 3 fund portfolio here: https://www.bogleheads.org/wiki/Three-fund_portfolio . Co-founder of Bogleheads.org, Taylor Larimore, has been preaching this simple portfolio for 20 years on their forum. This might be a sample portfolio asset allocation for anybody under 40 years old. Asset allocation depends on your risk tolerance, which can get a little complicated. Since you have been with Valic for ten years, you may not have experienced any loss to your portfolio in 2008, perhaps this allocation is too risky (volatile) for you (unless you had a variable annuity which invests in mutual fund sub-accounts). If you need a little more hand-holding, our CalSTRS Pension2 is also an excellent choice.
  4. Hi Kiwi, I am both surprised and pleased that I have gotten a few emails from teachers about this letter. While it is not groundbreaking, it signifies that perhaps California teachers are starting to become aware that there is a problem with our state Insurance Commission, and the why 403(b) has been primarily an insurance product since 1961. The silence on this issue is deadly for us. No one talks about it except a few of us within our teacher ranks here on this website, and at our advisory meetings at Los Angeles Unified, where I am a member. Your comment about not fully understand the issue is my responsibility. Sorry, this topic is complicated for a reason, to turn people off about its consequences. Not understanding how the 403b is administered and politicized here in California is what keeps the billions of dollars of teachers money flowing into the insurance industry without any disruption for decades. We have published many, many media reports, but our colleagues still have not gotten the message. So, I remain hopeful because you responded! This is the 25 word (or a little more :-)) of why you and so many teachers have Valic, or some other large insurance company for your 403(b), instead of investing your money in genuine stock and bond investments such as our pension plan does. Unlike all of the high cost, low-interest rate insurance products, Vanguard and Fidelity have no "real" persons that will come to your house or school to deliver a product. You can talk to them on the phone. Answer your question about vendors with a representative. Of course, all vendors have representatives you can talk to. The huge difference between the high-cost insurance products that you want to avoid like the plague and the Fidelities and Vanguards of the world is the telephone. Heck, I talk with my Vanguard adviser frequently, and because I have a certain amount, I also get a fiduciary financial adviser who will help me with taxes and distributions to fund my retirement (I am 70 years old and retired with a comfortable nest egg that you will have too!). But in order to help you, we need to know what vendors are available. Do you have a 457(b)? Do you know about CalSTRS Pension2? Yes, you can get your money out of Valic, and the faster the better! Be aware of surrender costs. I did the same thing paid the hideous costs just to get my money out of two insurance companies. To me, it was the principle of the thing, I did not want those companies making money off of my money! I have two books that I wrote that ARE about our sector because it's my story of how I went from annuities to a broadly diversified stock and bond portfolio over two of the biggest stock market crashes in history, and how I survived. You are doing the right thing by coming here. You are already 1000 miles ahead of our vast majority of our colleagues. PM me, and I will send you both books as a PDF file. In the meantime, you can stop contributing to VALIC and start researching if you have and post it here to all of the smart people here can evaluate the choices. Steve
  5. Future of Financial Advice

    I saw Blade Runner a couple of weeks ago, and how humans and androids might merge. Anyway, it got me thinking about the future of personal finance, and how different the conversations and financial advice might look like. This article was written 2.5 years ago, and the huge bias is that you STILL need a real live financial adviser: https://www.forbes.com/sites/richdaly/2015/07/30/why-the-future-of-financial-advising-will-be-bionic/#2907a458e574 In just 2.5 years things have changed. FinCon's recent conference in Dallas reflects more about the future than I think any other organization does (Scotty and I went to FinCom in 2016): http://www.finconmedia.com/ It was great! It's not difficult to imagine that autos will drive itself within 5-8 years, it's not difficult to imagine that mutual funds employ no expensive and useless active manager, and it's not difficult to imagine that your portfolio can be managed by Robo Adviser, and it's not hard to imagine that in the 2nd largest school district in the country, the Award Winning low cost 457(b) plan, is slowing starving out the hideous 403b plan and installing auto enroll with employees, because all of these magnificent developments are happening now! Because of these HUGE developments, I predict that within the next 10 years, the financial advice world will change so much that the current 403(b) problem with public k12 districts might just disappear! I don't know how or when, but the consequences of change and of financial advice, in particular, will be inevitable and massive.
  6. Tiaa Ny Times Article

    Here is an article supporting TIAA because all of the other insurance companies are much worse in the public k12 space: http://www.investmentnews.com/article/20171120/FREE/171129986/403-b-advisers-disappointed-with-tiaa-but-say-other-providers-are Excerpts: From our Scotty: "What TIAA's doing, I don't like it," Scott Dauenhauer, principal of Meridian Wealth Management, said. "But compared to what goes on in non-ERISA 403(b) every day, on a relative scale it's not the same. Relatively speaking, I'd rather have someone form TIAA than National Life Group. The stuff that goes on [elsewhere] in 403(b) land is still, way, way, way, way worse." From our Tony Isola: "If TIAA was in the non-ERISA arena, they wouldn't even be getting in any trouble. They're getting subpoenaed for things that are common practice and worse in all 50 states in the non-ERISA market," said Tony Isola, head of the 403(b) division at Ritholtz Wealth Management. "Where's the justice there?"
  7. Forum Upgrade

    Cool! The "choose files" went directly to my computer files where I had already used snip-it to capture the picture below from my spreadsheet, where I created the pie chart. In the old days, I had to upload the pic https://postimages.org/ and then copy the URL and post it here. Lot of work! Below is my 32/68 AA for a 70-year-old who needs the money for retirement. If I didn't need the money for my retirement, I would have more aggressive allocation. It would be something like a 70%/30% stock to bond and let my beneficiaries reap the benefits. TIAA is part of my fixed account, the 3.0% traditional annuity with no surrender costs, principle protection and no costs (except the spread).
  8. Politics and Investing -Keep Them separate

    Hi Tony, I guess I am missing something, which happens frequently. :-) Is there a point? It seems obvious because politics has nothing to do with constructing and managing a low-cost, diversified portfolio, but I don't know what you are thinking when you posted this. Thanks, Steve
  9. The IRS changes had a huge effect on K12 in reducing that number of vendors. The primary reason why the IRS had to reform the 403b because of the huge number, and so it became an auditing nightmare with so many accounts with numerous vendors.
  10. Tiaa Ny Times Article

    Hummmmmmmmmmmm..., this discussion thread "Tiaa Ny times article" has 523 views! Of course, it must be THEM! They are laughing all the way to the bank.
  11. whyme, My district used to have 150 403b vendors, but since the IRS changes its dropped to 27. The only decent companies are TIAA and Pension2, and some index funds from USAA. Here is a table I created to show Los Angeles Unified School District employees how these companies are categorized into either insurance annuities or custodial accounts with mutual fund companies: When a salesperson comes calling, they can whip out the above form and look for the company they represent and know a LOT more about the company. Here is our 457(b) Award Winning plan:
  12. Tiaa Ny Times Article

    Dan I noticed that the posting has slowed down or stopped but it’s usually in the early morning. I doubt if it's because of more teacher lurkers. I bet it’s more of the industry wondering how we are reacting to the TIAA NY Times article. How many annuity agents are lurking? They love it when I beloved companies are the subject of hate, as they can take it to their presentations and show our k12 colleages that their insurance company is squeaky clean, or if anybody asks an agent about Tiaa or Vanguard. They have lots of negative material to work with now. Steve
  13. Tiaa Ny Times Article

    Hi Dan, Yep, I did the same thing. Except I do not have Fidelity, two is enough, and TIAA and Vanguard are the best. Steve
  14. Whyme, That is a good question about higher education in general. Although doesn't higher education in general have better choices? Tony Tony and whyme, The fight I had with my union when I was trying to get them to at least hear their presentation was appalling. My union would have nothing to do with TIAA, meanwhile, right next door the Los Angeles CC district with their union's help happily selected TIAA to record keep their plan! Carolyn Widener, a very smart CalSTRS board member, came to one of my amateurish monthly meetings at a restaurant and was very happy to see what I was doing (Way back in the late 90s and early 2000s I held informational meetings to help teachers weave through the 403b mess. I met Dan Otter and Scotty through my meetings at that time. Anyway, Carolyn was appointed by Los Angeles CC union to be on the CalSTRS board! In fact, their entire LACC union from the president on down liked what I and others at my union were doing. My union president by, by contrast, told a colleague that "Schullo is not welcome around here!" What a jerk. I was NOT intimidated. He and other officers were convinced that I was going to economically benefit from TIAA being union approved. Here in California, higher education has 403b plans we dream about in k12. I cannot underestimate the utter difference in the cultures that are reflected in the unions. Steve
  15. Tiaa Ny Times Article

    Hey fellows, Nothing wrong with a couple of absolutes and 100% love for particular companies. Yeah, I know things can change in the future, but for now, I will be invested in one or both Vanguard and TIAA for the rest of my days, which is a lot shorter than you fellows. I have so much history good history with them. TIAA really understood the 403b California problem, and yeah they made mistakes but when you are in a relationship, it comes down to people. I have liked all of the good people I met personally at TIAA and Vanguard. Compare these great companies with my last annuity agent: I merely asked her what she thought of mutual funds for my 403b, she sh-ot back and said: "I will never recommend MF to teachers." When I asked why she said: "Mutual Funds are too risky for teachers!" That was 25 years ago and I NEVER EVER spoke to another annuity agent again. Today I think you call that "financial profiling" based on profession. Even with all of the resources, news reports, and comradery of us here on this forum and Bogleheads, the 403b K12 system was, and still is, very, very, very corrupted and wrong. But back in the early 1990s, NOBODY questioned the annuity monopoly on the 403b. We are making progress and perhaps auto enroll might be the game changer. In LAUSD, 800 people were auto-enrolled in the Target Date funds and 400 opted out.
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