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Posts posted by StevieRayClapton

  1. If there was a booklet provided along with her investment options, in fine print under the page listing all possible investments, you will most likely find the Plan's administrative costs. If you don't have said book, ask them for a copy of their prospectus.



    Vince, I now have both books. Other than the funds fees listed in the Fidelity prospectus, I can find no additional administrative fees. Almost sounds too good to be true.

  2. I just set up my wifes 457B thru Nationwide purchasing Fidelity Contrafund. Today, the county auditor brought her a sign up /transfer for AXE Equitable. She told my wife that "We are not using Nationwide much anymore, we are using AXE." She did qualify this to state that since my wife was already signed up she could continue with Nationwide. Yes, I realize that Nationwide has its share of problems but the ONLY product AXE offers is different Variable Annuities. ... blechh!

  3. The following news release appears to be some good news to those trapped in the VALIC 403B. Since it is brand new, I have not really had the time to investigate it. Will there be some hidden special VALIC fees?



    AIG VALIC Launches New Low-Cost, No-Load Mutual Fund Platform in 403(b) Market

    Profile Retirement Program Offers Top Money Management Talent and Web-Based Account Services for Participants; Compliance and Administrative Support for Plan Sponsors Facing Newly Expanded Regulatory Requirements


    HOUSTON--(BUSINESS WIRE)--AIG VALIC, a national leader in retirement plan services for public and private education, healthcare and government organizations, today announced the launch of a new low-cost, no-load mutual fund retirement savings program for the K-12 403(b) market.


    The company's new Profile Retirement Program offers a robust investing platform and a wide array of mutual fund choices for 403(b) plan participants who prefer a direct access retirement savings option. The program also provides plan sponsors with the same high level of administrative and compliance support to assist them in satisfying requirements imposed under final regulations governing 403(b) plans. AIG VALIC already provides this level of support to thousands of plan sponsors today.


    Profile offers more than 30 no-load mutual funds covering all major equity and fixed-income asset classes. Choices include passive index, life cycle, and actively managed funds, the latter managed by industry-leading money management firms, including American Century, T. Rowe Price, Oppenheimer, Blackrock and Wellington Management. Expense ratios for the funds range from .35% to 1.17% and average 0.8%.


    "With this new program, AIG VALIC is reasserting its leadership in the K-12 403(b) marketplace," said Bruce R. Abrams, President and CEO of VALIC and the VALIC Retirement Services Company. "For more than 50 years, we've partnered with America's school districts, large and small, to deliver effective retirement savings plans to their employees. The introduction of Profile Retirement Program reaffirms our commitment to this partnership. Profile significantly broadens the program options we offer plan sponsors and addresses their specific need for experienced compliance support in today's more rigorous regulatory environment."


    Profile Retirement Program is designed for individual investors who prefer direct access to a low-cost investment program with a broad selection of mutual fund choices and a robust platform to manage their accounts. Profile offers direct telephone enrollment and Web-based account management tools, along with support services and investment advice available from professionals at AIG VALIC's Client Care Center and Retirement Education Center.


    Profile's investment choices include no-load mutual funds and a separate fixed-rate annuity option. The mutual funds offered, representing a range of investment styles, are managed by highly respected and experienced third-party money managers. AIG VALIC acts as adviser for the funds and hires sub-advisers to manage individual portfolios. This structure offers several benefits over the use of public mutual funds, including lower overall costs, better access to institutional investment talent, and greater efficiency in the fund selection and monitoring process.


    AIG VALIC also acts as custodian for the funds, providing experienced compliance infrastructure and support to plan sponsors, along with written assurances in the form of "hold harmless agreements" and other service provider agreements to assist the plan in meeting strengthened regulatory requirements.


    "At a time when many 403(b) service providers are stepping back in the face of new compliance responsibilities, AIG VALIC is standing firm with our education partners, providing reasonable written assurances that we can assist their plans in meeting the new 403(b) requirements, protecting the compliance integrity of the plan and participants' retirement assets," added Abrams.


    AIG VALIC is one of the leading retirement plan service providers in the United States. For more than half a century, it has specialized in providing retirement programs and related investment, recordkeeping and administrative services to employers and employees of for-profit and not-for-profit elementary and secondary education institutions, hospitals and healthcare organizations, higher education institutions and governmental entities. AIG VALIC serves 28,000 client groups and more than two million participants. AIG VALIC is the marketing name for the group of companies comprising VALIC Financial Advisors, Inc.; VALIC Retirement Services Company; and The Variable Annuity Life Insurance Company (VALIC); each of which is a subsidiary of American International Group, Inc. As an IRS-approved non-bank custodian, VALIC is the custodian of the 403(b)(7) custodial account, and VALIC is the issuer of the 403(b) fixed annuity included in the Profile program.


    American International Group, Inc. (AIG), world leaders in insurance and financial services, is the leading international insurance organization with operations in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional and individual customers through the most extensive worldwide property-casualty and life insurance networks of any insurer. In addition, AIG companies are leading providers of retirement services, financial services and asset management around the world. AIG's common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Paris, Switzerland and Tokyo.





  4. Trying to be proactive, I sent the following note to NACO.



    Ms Cole,

    My spouse is an employee of a tiny county which offers the NACO/Nationwide as the only 457 choice. As an employee of a nonprofit hospital myself, I am very familiar with new IRS regulations which will impact on 403b and 457 plans. Obviously, there is a significant impact on the employer fiduciary responsiblity and requirement for due diligence.


    Here is a quote from a current article at NAGDCA


    "In the final analysis, the public officials charged with responsibility for operating a participant-funded 457(b) or 403(b) plan and overseeing its operations owe a duty to the employees who defer a part of their pay into the plan. A part of that duty is to make sure the employees are receiving fair value for the costs that come out of their retirement savings account, to make sure they are receiving a fair return on their invested dollars compared to the revenues being generated by the investment provider and the plan's advisors. The task is not difficult - it just requires attention and a willingness to do a little probing."


    Since my wife is offered one choice and one choice only, this is pertinent. NACO specifically holds itself up as an organization that is monitoring the plan via peers in an advisory committee.


    A simple google search of Nationwide reveals an unsettling pattern of lawsuits, revenue sharing abuses, high fees, and severely impacted retirement savings. How does NACO define due diligence and fiduciary responsibility in light of these findings? I personally invest directly into no load Fidelity mutual funds via my 403b7. Other than a $5/yearly fee, there are no additional fees other than those specifically set forth in the fund prospectus.


    It is noted that NACO receives in excess of $7 million dollars a year from Nationwide in return for an exclusive contract. Does NACO in turn require that Nationwide provide a non-annuity product that does not exceed the industy average (or better) for fees?


    I and my spouse have a direct vested interest in your actions in this regard. In the new light of revised regulatory rules and increased plan scrutiny, we anxiously await NACO's response.




  5. I have been researching the Nationwide horror stories and was very aprehensive regarding this. She is a county employee. The National Association of Counties has a exclusive relationship with Nationwide. So basically, if she wants a 457, that's it.


    Reading through the site, we discovered that they allowed apparent direct investment in the Fidelity Contrafund. While they go to great lengths to document the fees for the Variable Annuities they sell, there is no mention of any additional fees for the mutual funds they allow. I realize from my previous 403b with VALIC, that these folks are very good at hiding fees. I just can't find them in the Nationwide plan.


    We did not purchase any of the insurance products they offer.


    Since this is the only option she has, we didn't see any other choice. We are in the 28% bracket so the tax savings are significant. We both have Roth IRA's as well.


    Observations? Helpful ideas?

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