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Posts posted by krow36

  1. Skelly, welcome to the forum. I'm glad to see that you are making use of 403bcompare, a great resource! I don’t think you are missing any of Empower’s fees. It’s the administrator and record keeper for the San Diego Consortium and charges 0.16% as you mention. It’s unfortunate that there’s no low-cost index bond fund. The Fidelity 500 Index, Small cap Index and International Stock Index are very good funds. Can you put your bond funds in another account? If your TPA didn’t restrict your Roth 403b choice to Empower, Fidelity would be my first choice—lower cost and better selection. And they support a Roth 403b option. Are you sure you want Roth rather than traditional 403b contributions?

  2. VG’s Total Stock Market Index and VG’s 500 Index funds have a very similar rate of return over time. The latter has 80% of the TSM funds and many think either will do. VG’s Institutional Index fund is VG’s super low-cost class of the VG 500 Index fund, both tracking the S&P 500 Index.

    I would consider:

    Vanguard Balanced Index Institutional, ER 0.06%, stock/bond ratio is 60/40, which is automatically rebalanced.

    Or something like this which does have to be rebalanced??

    55% Vanguard Institutional Index Fund, ER 0.02%

    25% Vanguard Total International Stock Index Fund, ER 0.07%

    20% Vanguard Total Bond Market Index Fund, ER 0.03%

    Or just go with the Target Retirement Fund 2045 that you mentioned, which is rebalanced to become more conservative as you age? I think I’d be tempted to go with either the Balanced Index or a Target retirement fund.

    The administration fee of 0.10% is added to each fund’s ER. Still an excellent 457 plan! 


  3. I checked out IPX after you first posted about it. Thanks for bringing to our attention. No, I wouldn’t call the IPX offerings “immoral”. I think some of the IPX options are actually lower cost than Aspire’s 0.15% + $40/yr fees. That’s certainly the case a higher balance, with IPX Vanguard (P3) and IPX Fidelity (P3). For what it’s worth, here’s my summary, based on 403bcompare:  https://www.403bcompare.com/vendors/1966#/productlist

    Encompass is an advisor option with a fee of 0.31%/Q or 1.24%/yr, which is not competitive with Aspire which adds only 0.6% for an advisor. It does offer Vanguard Admiral class index funds. Of course I do not believe an advisor is justified or needed to contribute reasonably to a 403b plan.

    IPX Fund Portal (Investor Class) has a $6.25/Q or $25/yr fee and a 0.05%/Q or 0.20%/yr fee. It also offers Vanguard Admiral class index funds as well as many higher cost actively-managed funds. There are no low-cost index Target Retirement funds. So the lowest overall cost adds up to about 0.25%/yr + $25/yr.

    IPX Vanguard (P3) charges $21.50/Q or $86/yr. There is no asset-based fee. Only Vanguard’s Admiral class index funds are offered although there are no Target Retirement or LifeStrategy funds. This IPX option compares favorably with Vanguard’s 403b $60/yr.

    IPX Fidelity (P3) charges $12.50/Q or $50/yr. There are Fidelity’s low-cost total market index funds but their index target retirement funds are actively managed and are higher cost. This actually beats Vanguard’s $60/yr fee but not Fidelity’s $24/yr.

  4. I agree with Whyme that the MN state 457 plan is excellent and that you should consider contributing to it. However, you cannot transfer your Ameriprise 403b balance into the 457 plan. You can only transfer it into another 403b plan that is on your district’s 403b vendor list. Aspire is your only good 403b vendor. It’s a bit more expensive than the MN 457 plan, but the difference in 0.10% (MN 457) and 0.15% (Aspire 403b) in the asset based fees is not that significant in my opinion. It's $5 per $10,000, so for smaller balances it's not a game changer in my opinion. If you can afford to contribute to only one plan, then choose the 457 and just use Aspire to hold your Ameriprise balance. If you can max the 457, then also contributing to the 403b is a good idea.

  5. jcarlson8282, welcome to the forum! Yes, an Ameriprise variable annuity is expensive, and your return of 5.83% over the last 5 years is pathetic. I glanced at the prospectus and it's hard to estimate your fees without knowing exactly what you signed up for.

    Aspire is the best 403b vendor (and only ow-cost one) on your district's list and I think you should transfer your Ameriprise balance there. It is not difficult to set up an account with Aspire. We recommend you choose Vanguard for the vendor within Aspire. A very diversified, low-cost portfolio can be made using just 3 mutual funds: Total Stock Market Index, Total International Stock Market Index and Total Bond Market Index. Or you can use one of Vanguard’s Target Retirement Index funds. You can avoid the extra expense of an advisor by writing “self-directed” in the space for the advisor’s name. You don't need an advisor for such a simple, straight-forward asset allocation.

    Aspire FAQ:  https://www.aspireonline.com/resources/faqs

    Aspire K-12 403b: https://www.aspireonline.com/plan-types/403(b)-plan/k-12


    Ameriprise RAVA 5 Advantage variable annuity prospectus:


  6. 3 hours ago, davegram said:

    I think my next step will be to call the Voya rep. I've met with him before. I will be clear that I only want to know precisely what fees I'm paying. I'm fairly certain I'll end up prioritizing fully funding my Roth IRA each year from here on out. The other question is whether I can/should transfer to another vendor. 

    It’s possible, but not likely, that VOYA has adjusted their fees for your district to one of their plans. The plan name was probably on the paperwork you signed at the beginning? If you look at the categories of VOYA plans listed in 403bcompare, you see that they offer a Fixed Annuity, a Variable Annuity, a Mutual Fund (custodial account, no new accounts) and an Equity Index Annuity. We can rule out the Fixed Annuity  and an Equity Index Annuity because you have 2 Fidelity funds among others. The custodial account doesn’t offer Fidelity funds so we can rule that one out. I think it’s very likely you have one of their Variable Annuities.

    The VOYA Advantage Century (ReliaStar) is a variable annuity and I notice it has several Fidelity funds. This may not be your exact variable annuity, but its fees are probably representative of the type of fees you can have in a variable annuity.


    Contrafund, ER 0.62%

    Index 500, ER 0.10%

    Equity-Income, ER 0.53%

    Investment Grade Bond, ER 0.40%


    This variable annuity has the following fees in addition to each fund’s ERs:

    Administration fee, 0.15%/yr

    Contract fee, $30/yr

    Mortality & Expense fee, 1.25%

    There’s a “rolling surrender fee” for 6 “contract” years, of 7%, 7%, 6%, 5%, 4% and 2%.

    I hope this helps you unearth your 403b fees. I think there is no doubt that you will be better off rolling the VOYA balance into the NEA Direct Invest of Security Benefit.






  7. davegram, welcome to the forum! Hopefully you know the name of your particular VOYA 403b contract. There are a number of them:  https://www.403bcompare.com/Vendors/Browse   You can check both of the VOYA vendors on the 403bcompare website. It’s very likely that the fees in CA are the same in other states.

    Have you located your district's 403b vendor list? It may be maintained by your HR office or more likely by your district's third party administrator (TPA). Your district's website may have a link to the list. It's likely your VOYA fees are high, but it's possible to transfer your balance to a low-cost custodial account at another vendor if it's on the district 403b vendor list.

  8. 1 hour ago, Mooney_Lupin said:

    Okay, so I'm back with another question.  😀

    One factor that keeps popping up in my head is the fact that I can't rollover my 403b to the 457b.  I have approx. 40k with AXA and I hate to lose that jumping off point as I know it can make a big difference in 20+ years.

    I've been so caught up with the 457 that I didn't really think about how my SC Deferred Comp program also offers a 401k option.  I would assume the 403b would rollover into that.

    If I could get the rollover with a 401k, would that be the better route?  The investment options previously discussed look to be the same whether or not I choose the 401k or 457b.  It's just a matter of what I start out with... $40k or $0.

    Thanks again for your help and guidance!

    It does look like you have access to both the SC state 457b and the SC state 401k. The SC state-run 401k would be better than any of your district's current 403b vendors. So in the future, you could contribute to the 457 and to the 401k, but as long as you remain employed by the same school district, I believe you cannot roll the AXA 403b balance into either the 457 or the 401k. You can only transfer it to another 403b option that is on your district's 403b vendor list. The way to answer this question definitively is to call the phone # in the link you provided. Ask if you can roll a current 403b into the SC state 457 or 401k. In any case, you should stop contributing to the AXA 403b annuity. Sign up for the 457b and the 401k and start contributing to both if you can. 

    If you can't roll the 403b into either the 457 or 401k, start working to get Fidelity or Vanguard added to the 403b vendor list. Join the Facebook 403bwise Group if you want support in getting a low-cost vendor! 

  9. 3 hours ago, Luisa said:

    I prefer to get 457 for following reasons:  1) I may retire early and no need to wait for 59.5 age to get distributions without penalty or  2) I may contribute more  3 years prior to my normal retirement age to catch up with missed contributions in my younger years.  Am I right in my understanding of 457?


    I think Aspire is a good choice for you and your colleagues. If you work at it a bit, you may be able in the future to get your district to add Vanguard or Fidelity to the vendor lists. 403bwise has a Facebook Group with over 600 teachers focused on adding low cost vendors to their district's lists. Just a thought.

    You will be able to contribute (in 2020) 19.5k + 6.5k (age-50 catchup) for both the 403b plan and the 457 plan. Beyond that total of 52k, the additional catchups depend on your employer’s 403b and 457 plans. I’ve read that these Additional Catch-up features require good past records and that many employers do not include them in their plans because of headaches with past records. So you should check the district’s plans.


    If you’ve maxed your 403b and 457 account, I think it’s a good idea to then contribute to a taxable account for retirement. Taxable accounts have some advantages over traditional 403b, 457 and IRA accounts. Any distribution from those traditional accounts adds that amount to your taxable income for the year. Distribution from a taxable account only adds the amount of capital gain to your taxable income for the year. You are not taxed again on what you have bought with after-tax money.   

    The amazing Dan Otter invented and owns 20 Year Old 403bwise and deserves appreciation from all of us! And he's going stronger than ever! I'm a retired teacher and enjoy spreading the word on low-cost investing. Teachers have been victims of the annuity-sellers due to their trusting nature and their lack of information.  

  10. Luisa, the vendors of non-annuity custodial 403b accounts to consider are:

    Aspire, Security Benefits and PlanMember Services. I would prefer Aspire to PlanMember Services due the admin fees of 0.15% and 0.34%, respectively. I think they are both honest, non-deceptive companies without hidden fees.

    The choice between Aspire and Security Benefit’s NEA Direct Invest depends on how hard you are willing to work to get the very lowest-cost 403b account. SB DI admin fee is only $35 for balances under 50k. I don’t think Ed had problems dealing with SB, but his problems were with his district’s TPA and HR office. Recently, there have been reports of finding SB phone help with NEA Direct Invest. You should be aware that NEA DI is designed to be serviced over the internet with minimum phone assistance. Perhaps teachers call SB just to confirm that NEA DI actually exists? There’s really no reason or need to call SB and make initial contact. The way it’s set up, you fill out the application form and send it to SB. After a week, make the phone call and ask if they’ve received your application. You may or may not get the answer right away. Be persistent. Then call a week later and ask if your account is set up. If it is, they’ll give you access to it. Then you should fill out your district’s TPA salary reduction form.

    There have been no complaints about Aspire's phone service. They have a very useful FAQ website for routine questions. Aspire’s admin fee is $40 and 0.15% per year. Both SB DI and Aspire have very low-cost Vanguard Admiral class index funds. The account websites of both Aspire and SB DI have been reported to be very adequate. I think transfers of other 403b accounts have gone smoothly with both vendors, but I would  leave your Fidelity 403b with Fidelity.

  11. On 2/4/2020 at 6:19 AM, techteacher said:

    I also teach in Maryland and my district does offer a 457 as well as 403. Been maxing both for several years now. 

    OK, but is it the MD state-run 457 or is it using PlanMember Services 457? 

  12. The ideal we recommend on this forum and on the Boglehead forum is a 3 or 4 fund portfolio, using Total Market Index funds. I will assume an asset allocation that you can change, to illustrate what the weighted expense ratio could be.

    Vanguard Institutional Index Instl Plus, VIIIX, ER 0.02%

    TIAA CREF Small Cap Blend Index Institutional, TISBX, ER 0.06%

    American Funds Europacific Growth R6, RERGX, ER 0.49%

    Baird Aggregate Bond Inst, BAGIX, ER 0.30%

    VIIIX is an S&P 500 Index fund that covers large cap stocks and some mid cap stocks and covers about 80% of what a Total Stock Market Index fund covers. VIIIX is super low-cost and should be the largest percentage fund in the portfolio. Int’l stocks TISBX could about be about 20% of total stocks.

    To compare the cost of using separate funds with that of the target retirement fund, I calculated the weighted expense ratio of such a portfolio.

    Total stocks 80%

    Of total stocks, US stocks =60%

    Of total stocks,  International stocks = 20%  (.2*.0049 = .001)

    Of US stocks, 80% large cap (VIIIX) = 48% (.48*.0002 = .0001)

    Of US stocks, 20% small cap (TISBX) = 12% (.12*.0006 = .0001)

    Bonds = 20% (.2*.003 = .0006)

    Adding up the products gives a weighted ER of .0016 = 0.16%

    The ER of the target retirement funds is 0.10%. So you could go with individual funds, or choose a target retirement fund of your choosing, and there would be a very modest difference in expense ratio. If it was my choice, I think I would choose one of the target retirement funds that matched my desired stock/bond ratio.

    No matter which choice you make, there is an administration fee:

    The link below is out of date (2009). Ed's link in post following this, has current the


    https://www.chacity.org/images/FCKUploads/file/Careers/Employee Forms/401k-457 Getting Started.pdf 

  13. 40 minutes ago, K. Cook said:

    Great. Thanks both of you for looking into that. This is all very helpful information and I very much appreciate the help. So my other thought is.. my husband is military and we might be moving around a lot.  Which means me working in a lot of different states and districts. Is it better for me to have an IRA instead of a 403 b with all the potential moving around? 

    Contributing to an IRA has advantages and disadvantages over a 403b or a 457. You get to pick your IRA's vender rather than those on your employer's 403b/457 vendor lists. Yes the IRA is totally portable. Your 403b or 457 can be rolled into your new employer's 403b or 457 plan, or into your IRA. While you can't make further contributions to that particular 403b or 457 account after you leave job, you can leave it to grow if its balance is at least $5000. You can have more than one 403b account. Because the current maximum contribution to an IRA is only $6000 ($7000 if age 50), using only the IRA may not give you much of a retirement supplement. The current maximum contribution to a 403b or 457 is $19,500 (+$6,500 if age 50), so it's possible to save a lot more. Saving at least 15% of your after-tax income is usually recommended. Early retirement would need a significantly higher percentage.

    If $6000 is all you can afford to contribute, then yes, I would prioritize the IRA. But it would be a very good idea to contribute at least a small amount to a Fidelity 403b or 457. And maxing your husband's TSP is a great goal. If you teach in another state, you will be able to roll your pension contributions into your IRA.

  14. 1 hour ago, Luisa said:

    Anyway, I teach at one of the Maryland public schools.  Do I have access to a low cost state run 457 plan? I am new to 457 but as I am reading posts here, I am getting more interested with it as I can see the advantage on my part. 

    It looks like the MD state-run 457 plan is for MD state employees and employees of state educational "institutions", which I take to mean higher ed, not K-12. But I could be wrong and you should call them up and ask them. In any case, your district has to have a the vendor on their 457 list for you to be able to use it. If the state does allow K-12 employees to use their 457, and it is not on your district's list, you can probably get it added without too much trouble. In some states, the district cannot refuse to offer the state 457 plan. https://www.marylanddc.com/iApp/tcm/marylanddc/learning/library/public_sector_plan_types.jsp

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