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  2. Hi Megan, Welcome to the site and I apologize for my tardiness in getting you approved to post. Do you have a Roth IRA? If not, you could start with that at say Vanguard and then work to get better 403(b) choices. Here's a story comparing the 403(b) and the Roth IRA: https://403bwise.com/k12/content/23 Also, what state are you in? - Dan
  3. Today
  4. Sorry for your loss. Lost my husband 3.5 years ago too. I am a retired teacher with a CalSTRS pension, and I was not eligible from my husband's SS either. Here is the law that affects both of us: https://www.ssa.gov/pubs/EN-05-10007.pdf
  5. Hi Megan, You got excellent feedback. BTW, welcome to the 403(b) world with K12 school districts.
  6. I second everything krow said. I also want to encourage you to reform your district’s 403b/457b program. I was able to get Fidelity and Vanguard added to my district and I hope to eventually get rid of the predatory vendors. I’m happy to help you figure out how to do this if you’re so inclined.
  7. None of those 5 vendors are a slam dunk like Vanguard, Fidelity and Security Benefit (only their NEA Direct Invest) would be. However, if you are teaching in NJ, Lincoln Investment has an excellent low-cost 403b and 457 plan that you could use. It's also available in a few districts in NY and near Chicago. VALIC, and VOYA Financial may offer mutual fund based 403b(7) plans in addition to their very expensive annuity based 403b plans. You would have to talk to each of them and study their admin fees as well as the expense ratios of their mutual funds. Please do not let them sign you up to an annuity 403b!! Lincoln Investment does offer a mutual fund based 403b(7) plan that they call their Retirement Solutions Premier. It has a Management/Wrap fee of 1.25% but does offer many low-cost Vanguard Investor class funds. So this is far from ideal, and getting Vanguard or Fidelity added to the vendor list would be the way to go and worth the effort! Many states have a very low-cost state-run 457 plan that is available to school district employees. Teachers can contribute to both a 403b and a 457 plan (a maximum of 19k to each). What state are you teaching in? Does your district have a 457 vendor list? It’s possible that a state 457 plan would be all you need until later in your career?
  8. Yesterday
  9. I strongly do not endorse VALIC. I had to deal with them for years before getting out. However it is worth checking out what funds they have offered for your district's plan. It could be different in your area.
  10. Sorry for your loss. Did the Social Security Administration give you a reason why you are being denied benefits?
  11. Email your payroll specialist and ask if Vanguard can be put on the list. I asked my district if they would add Vanguard as a vendor for our 403b and 2-3 months later it happened! I couldn’t believe it.
  12. Hi! I'm a 5th year teacher and just now getting a handle on the 403b lifestyle. After listening to the podcast, I'm so upset my district does not offer Vanguard. If you had to pick the "next best thing" which would you choose between VALIC, Metlife, Lincoln Investments, VOYA Financial, or AXA. My district endorses VALIC, but they all seem like salesmen to me and seem to not have my best interest in mind. Thanks so much in advance!
  13. Last week
  14. Pushing this financial literacy announcement up. Register here: https://www.utla.net/contact/financial_literacy_101_signup
  15. I’m pretty sure that as part of my employment termination package, I had to sign an NDA. So let’s just say I continue to hold the opinion that US corporations believe they’re in a zero sum game against their employees. At the time my portfolio was in the very lowest range where retirement could be contemplated. I was certainly emotional, but my reasoning was still entirely sound. I had an intense desire to say goodbye to US work culture forever. A couple business days later I was lucky enough to get a great job offer that would require me to start working within a few weeks. I just relaxed as much as possible and let things take their natural course and during that time my emotions subsided. For a variety of reasons I decided I didn’t want to retire just yet, and I’m happy I didn’t miss out on my current job because of an early decision influenced by emotion.
  16. I am a retired calpers employee, my husband just died and social security told me I am not entitled to widows benefits. Who do I call for help?
  17. Isn't it bizarre to think our emails get flagged and our helpful sharing of articles have to be distributed discreetly? You'd think we were....403(b) sales reps with something to hide! Oh that's right, they have free access. I don't think we're putting aside reform, but I do agree that we are taking one of the two-pronged approaches here. 100% right Ed, it's about building relationships, and face to face, and holding their hands. That is gold. Great work getting your former colleagues a lower cost plan.
  18. Cal Newport wrote a book called Deep Work. I just borrowed it yesterday from one of the many wonderful libraries in my area. From what I've read so far (and heard him say on his recent podcast interview) we all have period's of time during the day that is better suited for deep work. Mine is in the morning so I'll be reading your post then. Thanks in advance for sharing, Ed.
  19. I didn't either, but you brought it to the surface! That is why I begin the Fin Lit unit identifying and ranking values. Yes, behavioral economics is a relatively new field of study. Captivating to me too. And that is why I've been MIA for a while! I am a fan of letting things percolate after gathering as much information as possible, asking questions and exposing every possible scenario. I've sought guidance from several valued mentors and have done research, read and created. And physical workouts are always therapeutic for me. I am almost finished writing a PD to present to teachers on the state of 403(b)'s which includes the basics of financial literacy in language they understand, not in salesman language. I will be proposing it in June to the PD committee and pushing to present it a couple of weeks later. I'll collect data and market it to area schools and seek approval for CTLE credits for attendees. Looking ahead, I will seek sponsorships. What's the worst that will happen? I'll help a teacher and do a lot of volunteer work. I also have a teacher interview in May and today I had a Skype interview for an international teaching position! It would be easier for me to discard scenarios early but I usually don't do that. How did you manage during your mental volatility between job switches? Are you happy with your move?
  20. It is well worth anybody's time. I know you've posted it here in the past. Wish I could duplicate it on the east coast. Baby steps...
  21. Earlier
  22. Pushing this up. Register here: https://www.utla.net/contact/financial_literacy_101_signup It's a FREE workshop with tons of useful information. 5 PD credit hours are provided for LAUSD educators.
  23. That’s a great way to get rid of inappropriate investments that have racked up large gains! A 6% effective tax rate is very workable! I suppose these pensions are going to limit a lot of educators. That’s a pretty healthy income . Oddly enough, I hope not to join you in that 😀. Who knows what’ll happen with this tax code. I’m not as knowledgeable on the Republican rewrite as I’d like to be, but I’m under the impression that the tax cuts for businesses are permanent and the tax cuts for individuals are set to expire sometime within ten years of when the legislation began? Speaking selfishly, I’m not terribly worried about the tax code, but health care has me quite concerned. It would be a relief to join the rest of the industrialized world before I get too much older!
  24. I don't have time to read up on Act 5, but if you MUST have four vendors then I'd do everything you can to make sure only the best vendors are selected. I documented and ranked the best vendors I've found in the state of Florida (which is a good proxy for the nation) here. Fidelity Vanguard Security Benefit's NEA DirectInvest Aspire PlanMember DirectInvest The problem is that both Security Benefit and PlanMember have predatory plans that they push hard. If you could find a fourth vendor local to your area that could be added to Fidelity, Vanguard, and Aspire, then you might be able to entirely eliminate predatory vendors from your district. I'd use this opportunity to nip this in the bud before folks like AXA can establish a foothold and sink their teeth into people.
  25. That's exactly what I was going to say! Still, my portfolio is at an all time high in terms of profit and balance...I'm going to really enjoy this before the next downturn 🙂
  26. I guess we're putting aside structural reform, like convincing the state legislature to reform the industry itself, and focusing on helping teachers navigate the system as it is today. Under those constraints I think the solution is to copy a lot of what the sales reps do. Find people who are trusted and respected by the staff and get those people to put in face time with every teacher who is willing to listen. Do the hard work of relationship building, face to face! Dan and others have already put the resources online...you need to bring them into the fold and hold their hands. It really shouldn't be that hard. I got a good chunk of my previous office pushing for reform because the cheapest index funds they had access to were 0.33%. I left before things were sorted out, but I just got news that they're getting really low cost index funds now. I'm not even particularly personable...you just need people who really care!
  27. I'm not sure exactly how Morningstar does things---I think they adjust for expense ratios, but not for loads. Don't trust me though...I'm sure their methodology is buried somewhere on their website. Since you're asking questions about expenses, I figured I'd start by cutting right to the chase...you're going to want to purchase total market index funds that have minimal expenses (no loads and rock bottom expense ratios). I understand that you're trying to look at past performance as a way of assessing the quality of a fund and its likelihood to perform well in the future. That is an entirely natural instinct, but in this particular domain, this form of analysis isn't helpful (actually it is more likely to lead to you selecting a fund that will under-perform in the coming years). This is the bottom line...the data shows that roughly 1/3 of funds will beat in the market in any given year, but that it is exceedingly rare for a fund to consistently outperform the market year after year. A few funds have consistently outperformed the market, but it is my opinion that they were probably just lucky. If millions of people flip a coin over and over again, you're going to find some folks who flipped heads every time, but it doesn't mean they were skillful. Regardless if it is luck or skill, I know for a fact that I have no way of differentiating the lucky ones from the skillful ones, which means I'm far more lucky to pick a lucky one whose luck is set to run out. This reality was best illustrated in 2005 when John Bogle reviewed the performance of the 355 mutual funds that existed in 1970 only to find: 223 funds (62.8%) were closed before 2005. 60 funds (16.9%) lagged the market by 1% or more. 48 funds (13.5%) were within +/- 1% of the market. 15 funds (4.2%) beat the market by 1-2%. 9 funds (2.5%) beat the market by 2% or more. Now you may be tempted to conclude that the roughly 10% of funds that beat the market over those 35 years MUST be skillful. Well, when you look into the data you'll find that quite of those funds owe their overperformance to a period of early dominance and they've now underperformed for more than a decade. It's my opinion that if you could take time to infinity, rather than 35 years, you'd find that nobody could beat the market. ...I suppose all of that is to say, past performance doesn't predict future performance. I've got an Investing 101 page that links to a spreadsheet I use to see how loads and expense ratios affect returns. Others have slightly different opinions, but in my view the best way to understand fees is to ask yourself what percentage of your inflation adjust profit has the fee taken away from you. For example, suppose: Inflation is 3%. Your portfolio would have returned 6% in the absence of fees. The fees actually consumed 1.5% of your investment. Well, after inflation your return is down to 3% and if you lose another 1.5% to fees, then fees have consumed 50% of your real returns. That's a big deal! So in your particular case, you've got a 0.72% annual fee and a 5.75% sales load. Let's assume 3% inflation, 6% annual returns, and a one time annual investment at the start of each year. You can probably see that if your real return is only 3% and the sales load alone is almost double that, then for the first few years your wealth is actually going to shrink! In fact, five years have to pass before you break into positive territory: After 5 years the fees consume 90.44% of real returns. After 10 years the fees consume 61.75% of real returns. After 15 years the fees consume 51.6% of real returns. After 20 years the fees consume 46.76% of real returns. After 25 years the fees consume 44.19% of real returns. After 30 years the fees consume 42.8% of real returns. After 35 years the fees consume 42.11% of real returns. After 40 years the fees consume 41.87% of real returns. Compare that to an index fund that charges 0.04% per year and doesn't have a sales load: After 5 years the fees consume 1.39% of real returns. After 10 years the fees consume 1.46% of real returns. After 15 years the fees consume 1.53% of real returns. After 20 years the fees consume 1.6% of real returns. After 25 years the fees consume 1.68% of real returns. After 30 years the fees consume 1.76% of real returns. After 35 years the fees consume 1.85% of real returns. After 40 years the fees consume 1.94% of real returns.
  28. I second what krow said. Thank for the info! 2018 was the first year for my RMD and I paid 16% tax rate on $100,000 income (SS, pension, two tiny businesses, and RMD). It is the most taxes I have ever paid in my entire life. My donations or my business losses did not put a dent in my tax bill. I am thinking about converting some of my IRA to a Roth, but I will pay even more taxes now to pay less taxes later with the rates go back up in 2025, or 26.
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