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Everything posted by krow36

  1. I think Tony is correct--she can roll the VOYA 403b balance to an IRA. She does not have to invest the money with VOYA. This is much better than how Tony's district treated him. I don't think anyone can restrict the rollover to TIAA. If she is retired, the IRS permits the 403b to IRA rollover to a vendor of her choice.
  2. Thank you ChrisC for providing the fund list for Fidelity's 403b plan. Because they have been lowering the ERs trying to catch up with Vanguard, they have introduced new share classes of the funds listed in 403bcompare. So I think these 3 funds are what we would recommend currently: Fidelity® Total Market Index Fund, FSKAX, ER 0.015% Fidelity® International Index Fund, FSPSX, ER 0.035% Fidelity® U.S. Bond Index Fund, FXNAX, ER 0.025% JT1906, if you use these 3 funds for the majority of your 403b, I think you will do very well. You will be completely diversified and super low-cost. You haven't said what your "other" funds were, but I think it should be the same. You've said you are in your mid-30s and plan to retire at 60, so you have many decades before you need your retirement money. If you can't resist trying to beat the index, I would confine it to a small percentage, ideally 5% or less. Max 10%? Rebalancing every year should not be very time consuming. As a suggestion, you might consider 60% Total MKt Index, 20% International Index and 20% Bond Index.
  3. I'm puzzled. The Fidelity index funds I listed are from 403bcompare. These are the funds that Fidelity submits to the 403bcompare site run by CalSTRS, the CA teacher's pension authority. https://www.403bcompare.com/products/68#/investmentoptions I think Fidelity may restrict the index funds available in their K-12 403b accounts to those funds and not allow the very lowest cost alternatives?
  4. JT1906, it's been a long time since I had a Fidelity 403b account so I'm not familiar with their current website. If you just want to learn about a particular index fund, just google the ticker (the fund's 5 letter symbol). If you want to know how you go about selecting them for your account, perhaps you should give the Fidelity help line a call?
  5. I’m glad you are now contributing to a Fidelity 403b! That’s great. The funds you’ve selected are not the ones we suggested back in Oct 2018: https://board.403bwise.com/topic/6938-reputable-403b-houston-area/ We are big fans of either using a target retirement fund, or a 2 or 3 fund portfolio using the “Total” index funds. Fidelity’s Total Market Index fund is broadly diversified and contains all the market segments that you have selected. The segments you’ve selected are more risky than the total market index funds. You can read about the 3 Fund Portfolio here: https://www.bogleheads.org/wiki/Three-fund_portfolio You can read about index funds here: https://investor.vanguard.com/index-funds/what-is-an-index-fund The funds you’ve selected have a much higher weighted expense ratio (ER). Have you looked up the ERs? What is the 49.05% of “Other”? The higher ERs will reduce your return over time. I think you would be better off using the funds below (which are those suggested by Ed). Total Market Index Premium, FSTVX, ER 0.02% International Index Premium, FSIVX, ER 0.05% US Bond Index Premium, FSITX, ER 0.03%
  6. krow36

    Helping a Teacher

    ChrisC, when you talked to Security Benefit, did you ask for the plan number for NEA Direct Invest, or for Security Benefit? If the former, maybe there is not a number for NEA DI, only for SB?? Likewise, the TPA doesn't have a plan number for NEA DI, only for SB? Maybe each vendor on the list has only one plan number. Of course if the above is correct, it probably means that either SB is being intentionally obtuse, or their phone reps are just incompetent. The plan ID number problem has been reported by other posters. I just checked the TPA website for my old district, and there is only a single plan # for each vendor, NOT a # for each plan of each vendor. https://www.ncompliance.com/guest_employervendors.aspx?EmployerID=64
  7. krow36


    WA teachers are fortunate to have the WA state-run 457! Only about half the states make such a plan available to teachers. Of course in addition, your district may have a low-cost 403b plan you can use. Some 403b plans (Vanguard and Fidelity) are even lower-cost than the WA state 457. Using both plans can be very useful for two income couples.
  8. krow36

    Helping a Teacher

    No, you don't have to have membership in the NEA. NEA Direct Invest is a Security Benefit run plan and NEA isn't involved in the on-the-ground administration. NEA doesn't need to be the district's union. Of course in some states and districts the teachers are not represented by any union. All that's necessary is that Security Benefit is on the district's 403b vendor list.
  9. I love the Dilbert strips on investing! The Callan Periodic Table is always interesting, isn't it? Emerging Mkt Stocks are usually on the top row or the bottom row! ScottO you can check your spreadsheet with one put out by the national CPA organization. https://www.360financialliteracy.org/Calculators/403-b-Savings-Calculator3?fpath=197
  10. I don't think you need to hesitate on opening a 403b account at Vanguard. They are an excellent firm and will not take advantage of you. Increasing your 403b contributions is an excellent idea. Maxing it is ideal. Contributing to a Vanguard Roth IRA is also a very good idea. It will give you some tax diversification in your retirement investments. Hopefully your salary will increase later in your career and your income tax bracket will probably be higher than it is presently.
  11. Vanguard is the lowest cost 403b provider on that list. Vanguard is our favorite 403b vendor! I agree on steps 1, 2 and 3. For fund selection at Vanguard, you can use one of their Target Retirement funds. It's a single fund that includes 4 index funds: US and international stocks and US and international bonds. It rebalances for you as the markets change, and gradually becomes more conservative as you approach retirement age. I would select a TR fund with a stock/bond ratio of about 60/40 rather than by using the TR's date of retirement.
  12. Omar, welcome to the forum! Oppenheimer/Invesco is not recommended on this forum because of their high fees. Most districts allow a number of vendors to offer 403b plans to their employees. So the first step for you should be to find the district's 403b and 457 vendor list. It sounds like the district is using the Credit Union as their Third Party Administrator (TPA). It's possible that the TPA is also a vendor, or has a financial relationship with Oppenheimer. So you should be wary and be aware of possible conflict of interests. I think you have to deal with the CU if they are the district's TPA. Just let any sales pitch bounce off like bullets off Superman!! You are in information-seeking mode, not buying-mode.
  13. I get it finally that your want FI in your Roth IRA because if it was equity, it might not be there in a downturn. You have a larger taxable account than a Roth IRA. I think your taxable account should probably be your emergency-emergency account, rather than the Roth IRA. If you didn't have the taxable account, I can see why you might want less volatile funds in the Roth IRA. I guess in the long run, it's not going to make a lot of difference. I suspect that in the future you will switch to at least some equity in your Roth IRA accounts as your accounts grow.
  14. I don't see the logic of all fixed income in the Roth IRAs. There is no advantage if you make a withdrawal of your contributions. It doesn't matter whether you withdraw fixed income or stocks. There is no tax due in either case. You are passing up having the maximum tax-free growth in your Roth IRAs.
  15. D Junkins, thanks for the update. And thanks for the tips on dealing with the SB phone reps.
  16. OK, I can’t find the information on the funds in the AXA and Lincoln plans either. What we’re looking for is low-cost, broad-based index funds. Your link for VALIC was great. VALIC’s annual fee of 19 basis points (0.19%) is not excessive and combined with the Vanguard index funds, would give you a very good, low-cost 403b account. If you want to be diversified and invest in international fund, I suggest you use your Roth IRA or your taxable account and pick a Vanguard Total International Stock Index fund. The 2 American Funds’ international stock funds that VALIC offers have ERs that are too high. Not everyone thinks it’s necessary to invest in international mutual funds due to US companies having much of their business overseas. VALIC annual fee of 0.19% Vanguard 500 Index Admiral VFIAX, ER 0.04% Vanguard Small Cap Index Admiral VSMAX , ER 0.05% Vanguard Total Bond Market Index Admiral VBTLX, ER 0.05% So your overall cost would be about 0.23%, which is great! AXA annual fee of 0.31% AXA Retirement 360 in offered in CA and it includes some very low-cost index funds: iShares Total US Stock Market Idx Km, BKTSX, ER 0.03% Vanguard Developed Markets Index Admiral, VTMGX, ER 0.07% Vanguard Total Bond Market Index Adm, VBTLX, ER 0.05% https://www.403bcompare.com/products/260#/investmentoptions If these funds are offered in your district’s AXA 403b, your total fee would be about 0.34% (maybe 50% or more would be in BKTSX depending on your asset allocation?). I think this is certainly a reasonably low-cost 403b and also worth using. I think it’s likely that the Lincoln 403b plan with a fee of 0.25%, can be used to Vanguard index funds, and is also a very good plan. I would not make further contributions to your AXA variable annuity. Can you find out the expense ratios of the sub accounts you are using in your annuity? Is there a mortality and expense (M&E) fee and if so, how much is it? The total of the annual fees will determine whether you should wait out the surrender period, or pay the surrender fee.
  17. chr555, welcome to the forum! I'm guessing that your district has worked out a 4 vendor arrangement with them and that the 4 plans are not the national plans offered throughout the US? Are the basis points you provided for the 3 vendors their administration fees? Is the district's admin fee for the AXA Retirement 360 plan 0.31%? And does it offer Vanguard Index funds? In order to help you figure out your best 403b option, we need to see the individual funds and their expense ratios, as well as the fees each vendor charges for their plan. Can you provide a links to the 3 vendors' websites for your district? In general, for retirement savings, you are better off contributing to a 403b and/or a 457 plan than to a taxable Individual or Joint account. The idea is to postpone paying income tax on those contributions until you are in retirement and in a lower income tax bracket. If you think a pension and other income will give you a higher tax bracket in retirement than currently, then contributing now to a Roth 403b and/or 457 is preferable to using a taxable account. If we can help you discover a 403b or 457 plan with reasonable fees, say well under 1.0%, you can transfer your AXA balances to it. Can you also post the 457 vendors? What state are you in? Many states have a state-run low-cost 457 plan that school district employees can use.
  18. The MA state 457 plan and the Fidelity 403b plan are both very good plans. Here's some information on the MA State 457 plan: The plan Administration fee is 0.08%. I would use the following very low-cost funds: State Street S&P 500 Idx Securities Lending Series I, ER 0.01% State Street Russell Small Cap Index Securities Lending Series I, ER 0.02% State Street Global All-Cap Equity Ex-US Index, ER 0.05% State Street US Bond Idx Securities Lending Series I, ER 0.02% https://docs.retirementpartner.com/ioag/98966-01_IOAG.pdf On the plan: https://docs.empower-retirement.com/EE/Massachusetts/DOCS/Two-Paths-To-Investing.pdf https://fascore.com/PDF/mass/SMART_PlanOverview.pdf
  19. The MA state 457 plan is very good. I'll look at it later and check on their fees. A 457 plan does have a "distribution advantage" over a 403b plan. Once you've left your current employer, you are allowed to take 457 distributions without the 10% early distribution penalty. (Of course they are taxable income.) The 403b plan requires age 59.5 before the 10% early distribution penalty goes away. However, the 403b plan does have an age 55 no penalty option, which may be possible. It might be a good idea to eventually have some savings in the 457 as well as some in the 403b plan. But you can decide on that further down the line. You can max out both the 403b and the 457 plans as well as the Roth IRA. Who knows what the future will hold?? You cannot move your AXA 403b balance into a 457 plan, it can only be transferred into another 403b plan, unless you quit your current district and are hired at a different district. So you need the Fidelity 403b to hold your AXA 403b balance, whether you make further 403b contributions to the Fidelity 403b, or not. You will not find a lower cost 403b plan than Fidelity's, so I would make contributions to it for a while if possible.
  20. Yes, I believe that Equi-vest is only used for their variable annuity plan. If you are up 25.58% YTD, then I believe you are invested aggressively in the S&P500 and an international stock subaccount, so you don't need to worry about that. You would probably be up about 27% at Fidelity, depending on the mix of the 2 funds. I think you are probably in AXA's EQUI-VEST Series 201 plan. https://www.403bcompare.com/products/153#/investmentoptions If so, there’s a 5% surrender fee for 6 years. If so, you are probably in these sub accounts: EQ/Equity 500 Index (ER = 0.58%) and EQ/International Equity Index (ER = 0.81%)
  21. With the 403b plan, you haven't mentioned the name of the plan. The name should tell you whether it is an annuity-based plan, or a mutual fund based plan. The AXA variable annuity plan allows you to choose an S&P 500 Index fund and an International Stock Index fund, but the variable annuity plan has a surrender fee of 5% for 6 years. With your Roth IRA with AXA, there will not be a surrender fee. You will have to ask AXA for the expense ratios of the funds in your Roth IRA, and also for any other fees in the Roth IRA. For fee info on both the 403b and the Roth IRA, you should call the AXA 800 number, not the number for the local rep. The 800 number is more likely to give you complete information on the fees you are paying.
  22. The fund names I gave were those for Vanguard. Here are the Fidelity names: Total Market Index Premium, FSTVX, ER 0.02% International Index Premium, FSIVX, ER 0.05% US Bond Index Premium, FSITX, ER 0.03% The first chore is to stop your contributions to the AXA plan. Contact your HR or third party administrator (TPA) for the form. Then I would contact Fidelity for the forms to establish a 403b account with them. That will take some time to get set up. There will also be district HR and TPA forms to take care of. After you see that your contributions are being made every pay period, you can take on the chore of moving your 10k balance from AXA to Fidelity. This involves forms from AXA, Fidelity and your TPA, all signed by the other entities and you, and this can take several months. So you will need patience. In the meantime, you can tell your colleagues about how much lower cost Fidelity is than AXA! And what that cost difference means, over time. Assuming that you are in AXA's variable annuity plan, you will probably be charged a 5% surrender fee, or about $500. You should ask AXA for the amount of your surrender fee. You could consider the fee the cost of learning a lesson about annuities? I realize it's very annoying, but it's probably best to pay it, and put your AXA balance in a great low-cost plan. We've all made costly mistakes in the process of learning about investing. Most of our mistakes cost $1000's instead of just $100's.!
  23. Without a doubt, Fidelity Investments is your lowest-cost 403b vendor on your district's vendor list. Their annual fee is $24. Their broad-based index mutual funds are probably the lowest-cost you can find in a K-12 403b plan. Check out the funds at: https://www.403bcompare.com/products/68#/fees For complete diversification, all you need is: Fidelity Total Stock Market Index fund (more complete than S&P 500 Index as it includes mid and small cap stocks) Fidelity Total International Stock Market Index fund Fidelity Total Bond Market Index fund
  24. Here’s an illustration of the effect of fees over time. It shows the difference between a fee of 1.74% and of 0.07%, if contributing $250/month over 35 years, with an assumed market return of 6%. There’s a difference of over $100,000!! That’s getting to be serious money! https://docs.google.com/presentation/d/1Q4vixuuGGAVzZIF0G1EOriI_RQPuqgn_bpOmh9UrqPc/edit?fbclid=IwAR2OvqHkAGsK7BUtNOfYn7sR3vlBWek60WVm6xecfaSf6mzp7pfvMjlblPY#slide=id.p5
  25. Assuming you have the variable annuity, I didn’t mention the AXA $30 per year Administration fee, or the 5% surrender fee that you would pay for each of the last 6 “contract years”. Ariel, welcome to the forum! Hopefully your district has other vendors on their 403b vendor list. You can transfer your AXA 403b 10k balance into another vendor’s plan. Can you post the list? Hopefully there will be a low-cost vendor you can use. Also, what state are you in? About half the states have state-run low-cost 457 plans that public school district employees can use.
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