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Everything posted by fredalan

  1. fredalan

    Mf Global

    Suggest it is not quite as clear as we being discussed. investors in MF Global were sophisticated e.g. TIAA, Fidelity, many State Retirement Funds etc. each of them employs many seven figure individuals whose job is to vet risk. none of these firms expects to hit home runs on each investment nor even singles sometimes. when you go for 25%++ returns, you have some investments that are losers. they may be unhappy when they lose money but not surprised. as to the customers, I have not seen a full profile but suspect many are options traders, again, it is their own (or clients money that has been given to them to invest) and they are responsible for win's and losses. they are in the risk business. if less than that level of sophistication are dabbling in options etc, then we can feel sorry for them but, again, their money. at final level are employees ... always sad when people lose their jobs. overriding this all is if Corzine and his associates are crooks and co-mingling customer and investor dollars or some other nefarious activity. that is criminal and they should be indicted. the unfortuate part of video is it lasts forever ... as we will see endlessly played next year is Biden saying "when we were first elected, the first we called Jon Corzine to advise us how to get out of this financial mess was Jon".
  2. have to go to dinner but $3billion is operating budget of Dade County Schools vs $12 per participant in a 403b plan. conflict? so the idea is to educate people to become educated and that is great. go and how can I support u
  3. one is a state mandated plan the other is a District opt in From what I can gather, you seem to be saying that you want "financially astute" participants to sacrifice their interests for people who cannot be bothered to learn anything about investing. Forget that nonsense. Virtually anyone is capable of learning about investing, and if they choose not to, that is their problem. Also, Fred, you had no comment about the Connecticut 457 plan with its .12% administration fee and access to Vanguard Institutional (and other) funds. I suppose that is the type of plan that is just for the financially astute, eh? Wow, Connecticut is really doing its public employees wrong, isn't it? Isn't it interesting how folks like Intruder and Fred fail to respond when their arguments are demolished? as one elitist to another I guess everyone can become financially astute. right! I love 457 employer plans. am totally in favor if there is a solid educational component. what is the percentage participation in the Conn Plan? love the Conn plan
  4. why not use your enormous knowledge and influence to convince Districts to change their approach. Just suggested to BH for one of her California clients: Market the 457 - excellent plan that has very very low participation for 3 years 1. Unions contribute $3 per member (represents about 1/3rd of the annual all-in pay packaage of Union President - who is worth what he is paid) 2. Administration $3 per employee 3. Vendor $5 per employee Utilize the sophisticated communication facilities of the Union and the District plus the almost $1 million annually in a financial education program. The program is really "let us tell you why u r stupid to be in one of these 403b's when u can be in the Districts 457" - said nicer. 457 is employer plan and no prohibitions against doing this. In 36 months, you have a far better educated group that will now, through education, abandon the terrible 403b plans they are now offered. Today, as you know, the excellent 457 has dismal particpation except among the most financially astute. why don't you organize and effort in California to do this statewide. havin low bp plans only helps those who know how to invest ... unless you fund an education program.
  5. it is great how you are not burdened by seeking facts before you explain your conclusions. almost everything u just said in this e mail is incorrect. earlier u said u knew of transgressions by the other Associations, I offered to have the IBC attorneys contact you if you will provide you phone number or e mail. If you know of wrongs you have an obligation to report them or not make spurious and allegations.
  6. ah but the facts are a slippery thing ... FASA and VALIC have a 20 yr old relationship that involves a flat fee (a totally disclosed pittance). You are confused about "Platinum" with ASBO. FASA disclosed this - which everyone knew - to the IBC at beginning. You forget the Consultant firm etc that were also part of the conspiracy. Tell me about your source on your statemet - "So some of these underlying groups do receive cash from and have financial relationships with these vendors. To think otherwise is to be naive. How many people will enroll in the (so-called) low cost offering via 1-800 or the web, when a shiny, smiling rep from AIG is standing in the breakroom?" It is your duty to get this exposed. Please provide your phone number or contact and I will have the IBC attorneys contact you this morning. With your source information you will have done a valuable service and we will get this exposed now. Or you will sound like some of the losing Fixed Annuity companpanies VALIC has over 40k Florida K-12 clients - let me you in on a secret - part of the deal is VALIC slashes their fees on all prospective AND exisiting clients ... as did other fims selected. The more assets that occur statewide the lower go the fees. It is called bargaining on a statewide plan. Gee that ought to make all those VALIC, AXA etc clients unhappy.
  7. Gee some of us are getting it. The game has changed 61 of Florida's 67 District have the same TPAish firm. They are paid by the District. The new regs require more work and the District can eitther take the $12 for itself or give the $12 to the firm to do the work. The overwhelming percent of Districts will likely pay to have the work done by the firm. For non Model Plan firms, the TPA will do the work but those companies, if a District decides to add another company, is charged a higher fee. That was the decision by IBC and Risk Managers. All fees that are charged directly or indirectly are always passed through to the customer .. in one form or another ... unless you live in North Korea
  8. Of course fees are secondary. You are not paying them. Your response is silly. First you have to understand what the goal is of the group, district employer etc. then you find out how much and what the employer is contributing to the program research, organization, education, administration etc etc. If HR is going to operate this as a component of their other benefit programs and invest in success, then you drive for lowest fees possible. the vendors role is decidely different. If your Districts are conributing in a manner most School Districts do, you can have the provider fund or annuity pay the individual to invest (admittedly a little hyperbole) and people won't invest. Not only look at the LAUSD 457 or at the great 401k or 457 plans offered in grandfathered Districts in Florida. A geat 457 plan in Dade County has 51 participants out of 40k employees while some scud annuities have 2k. Minimal particpation, except by the more sophisticated financially - 5%, is guaranteed result. There are countless examples and we can either call most educators dumb or we can accept that we need to find a halfway house for them. Again, give me a list of all the Districts that treat this program correctly. start with Jeff County Col, NYC, Minneapolis ... now you continue
  9. Jim, the "$12 fee" paid to the District per participant was what I was respoding too. This is an opt in program since each School District in the nation is a seperate decision making autority. There are about 350k Florida educators in 67 Districts. Estimated 20+ of Florida Districts are in top 100 in size in nation. Ergo many sophisticated organizations. All of the funding for Consultants etc was provideded by the Associations - roughly $250-300k+ in hard costs. Each Association contributed soft costs and pro bono expert contributions from the Risk Managers. When the RFP was submitted a $1500 process fee was required - to weed out. Post finanalist selection, each winning vendor was told there were two requriements: 1. $12 per particpant fee annually 2. $50k first year and $10k annually thereafter to fund the "roll out" and educational cost. Associations will pick up the difference in costs (estimated another $100-150k). None of the winners objected and this is obviously insignifcant dollars spread out over Florida. No Association had any financial interest in the outcome. Each winning company signed a "Committment Letter" which is pretty tight. Plan Administrator was hired to work with Districts over next 120 days to assist Districts. Obviously, the vendors will have seperate marketing programs of their own. I was involved in the first two IBC's (PEORP and Healthcare) but not in this process except at the very beginning in mid 2006 and on sidebar converstions in 2007. Never attended a meeting or met the Consultants as I was in Asia and Europe on business much of time since mid 2006. With that said, I did get briefed after IBC made the decision in late January 2008. i think they did a great job and hope a lot of other states emulate them. ScottyD I disagree ... fees are the second question.
  10. Scotty D, not a "trust me". as said before: 1. Model Plan was driven by present reality of K-12 market. Tell me shat percent of the K-12 districts have, to date, created a plan comparable to NYC or most major HC institutions? Precious few. The IBC looked at them and talked to a lot of other non-Florida Districts. Will this environment change? Sure over next 5 years 2. Everyone on the IBC and Association leadership understanding that vast majority of Florida's 130k and 60k inactive 403b participants have bad plans ... and wanting to do something effective about it 3. IBC not wanting to duplicate another failed plan that was price driven but did not understand present market reality nor provide any funded educational program 4. Most don't know that the now hearalded Florida PEORP program evolved in pricing and options. So will the IBC Model People keep asking the wrong first question - what the fees? talking about driving for lowest bp's etc is just conversation unless you have the poltical circumstances allowing a funded educational program. That is the real first question.
  11. ScottyD, There was no discussion of fees till after the vendors were selected. W&R only is offering no-load mutual funds like American Century
  12. Joel, The PEORP plan was driven 8 years ago by the same coalition of Florida Associations (IBC) that just did the Florida Model Plan. Jeb Bush, one of the final three decision makers, said he never saw a piece of legislation that had more lobbying. The IBC prevailed and drove a superb plan that now has over 140k participants in the DC option. Reality on the 403b / 457 Model Plan is that many preferred options would not bid unless they got special circumstances e.g. statewide exclusive. IBC nor its' consultants knew they could not sell that today. Dan, Right, just as I suggested when the LA 457 plan was being devised: 1. fees are not the first question you ask 2. if the School Administration and Unions are not willing to belly up to the bar on committing serious dollars to educate people, the plan will flop. If you ask the vendors to do it, they will charge you BenefitsGeek, How do you know what the actual pricing was?
  13. the IBC was faced with a reality .. post a member survey conducted by Mason Dixon ... create another great 457 LAUSD type plan that never addressed the 35k+ people enrolled in the LAUSD 403(b) plans that range from pedestrian to dreadful. Except for the most sophisticated (or lucky) that enrolled in the 457 (700 people have enrolled?) no one enrolled in the LA plan for totally predictable reasons. Or the IBC could create a balanced plan that has a decent chance of freeing Florida educators from the awful awful 403b plans they are in now. Therefore picking at the edges of whether the costs might have been lowered (and all the accepted plans have further guaranteed price reductions) are sidebars which do not live on today's K-12 planet. focus on the benefit to the 130k and 50-60k dormant Florida teacher programs and the potential remedial effects to their retirement lives. remember all the exisiting plans of the winners convert to the new plan. this was an easy choice but, realistically, the Model Plan is a important migration in Florida toward a better world. everyone involved understood what a real "Model Plan" will look like in 3-4 years. lot more info on the website within the week.
  14. The first thing that many of the "losing firms" questioned - after they lost - was the motives of the organizations. FACT - THIS WAS ENTIRELY SELF FUNDED BY THEM AND NONE OF THE ASSOCIATIONS HAD ANY FINANCIAL INTEREST IN THE OUTCOME. This was actually the third project the four associations came together on on the last 8 years (1) reform of the Florida Retirement System (2) an effort to resolve healthcare.
  15. Don't read this site often but you have some quality people on this site e.g. Steve Schullo. as to the new regs - the changes may well be profound for consumer benfit depending on the integrity and political willingness of employee Unions and School Boards. one absolute result will be margin reductions for the consumer, manufactuer and agents. the new regs give both Unions and Districts a platform to reform the present 403b K-12 anarchy if they have the political to take on the local annuity salespeople. will many Unions and Districts do this? based on history, you would have to bet against it. market pressure will force pricing down but price is never the determinng factor. you can give away product and few will participate unless the Unions and Districts agree to fund an educational program. an interesting test is LA Unified where they have a consumer friendly 457 plan but still have the multitudes of annuity salespeople that will consistenly bad mouth the 457 vs their 403b annuity. has the LA Unified and Union created an educational program - and funded it? too early to tell. other effects will be the exit from the 403b biz of many small and mid-size manufacturers - already happening. some of the larger annuity providers will buy these blocks at a substantial discount but this may well become a marginal business. on the distribtuion side, the same crunch will occur. companies with captive sales forces will find it difficult to support them unless they are capturing substantial other client assets. independant agents will have to change their modus operandi and de facto give up on front commissions.
  16. Mark I am on a project relating to 403b and you might be able to assist. can you tell me how I can reach you?
  17. the mere reporting to the police would create the baseline (and obvious warning) if any further action was done against you or your family.
  18. if it is a threat (and your report sounds like one) then why not report the rep to the police. if someone threathened my family, that would be logical to me?
  19. no I was misunerstood. I also believe that Public schools will have to fully conform to the new regs.
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