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celia

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  1. Celia I do not understand your view. You are blaming those who were forced out of the pension for the poor results. What about the professionals running the pension to begin with? As the author Revell says,"A combination of underfunding by the state legislature and poor investment returns made the West Virginia teachers' pension plan the worst-funded of its kind in the nation." So the elected officials failed to properly fund the program while the professional administrators and investment managers did a lousy job. Why would you expect a new science teacher with no financial training to do better? The taxpayers will be bailing out not the teachers, but the administrators who made one poor decision after another. Including offering an expensive fixed annuity and "advisors" who have likely made a fortune over the last 17 years. Jim Jim, My comment is not about how the former pension was run 17+ years ago that the teachers left behind (which was under-funded and had poor returns), but what they have been doing with their contributions in the last 17 years. I assume the teachers had choices during these 17 years in what they invested in and most of them probably went for the annuity. For an average salary of $50,000 with 7.5% withheld for the 401 plan and another 7.5% contributed to their plans (by the school district/state??), this means $7500 was being added to their account each year. A teacher who averaged $50,000 over a 10-year period had $75,000 put into their plan. If this is so, how can this continue for 30 years and the average balance be only $33,944? Even an annuity wouldn't do that badly. Maybe this article isn't as clear as what it should be, but still my point is that even though they are trying to make the switch so that it doesn't cost the state anything today, in the future, ...
  2. Here is an article telling how West Virginia teachers are trying to get back into the defined-benefit plan that most other state employees have. Take this 401(k) and Shove It Last week, West Virginia teachers got to vote on whether to remain in 401(k)-style retirement plans or return to generous state pensions. But you won't be so lucky. Woe be the taxpayers who bail out those who invest poorly.
  3. Vince, I probably wasn't as clear in my posting as I could have been. Yes, I want to convert one of my (traditional) 403b's held at a mutual fund company into a Roth IRA at the same company. I was wondering if there was another way that I hadn't considered. Since the money is being handled at the same company and they already know my age, I'm not sure I need the TPA ok. celia
  4. My district's TPA is OCTFCU (Orange County Teachers Federal Credit Union) which recently changed their name to SchoolsFirst Federal Credit Union since they are now serving more districts than just those within Orange County, Calif. A discussion about them and Vanguard was started several years ago but I resurrected it recently by asking about Information Sharing Agreements. This thread can be found at Octfcu And What Are My Options?. I suggested a campaign to write Vanguard's CEO and the response from that can be found at Vanguard Response. In this current thread, the credit union is not the issue, but rather if there is another way to do my conversions to Roths.
  5. I can no longer contribute to my 403b at vendor V since they will not sign the Information Sharing Agreement with my district's new Third Party Administrator. I also have another 403b at vendor B that I started while working at the same district and they have signed the Information Sharing Agreement. While looking at all our assets, I see that we have the majority of them in tax-deferred accounts and the Required Minimum Distributions at age 70 1/2 are going to be hard to swallow since we will be in a higher tax bracket then. So I just decided to stop 403b contributions this year and started figuring out how to convert some things to Roths. I also want to be able to re-characterize the Roths if I need to, so I think going from a traditional IRA at V to Roths at V should be the last step in this process. Note that I am planning on multiple Roths in order to make re-characterizations easier and I may convert extra assets on purpose with the intent of un-doing at least one Roth (especially any that loses value between the conversion date and next April 15). Since I'm over 59 1/2, I have this flexibility (or I could have waited until I stop working in a few years). My question is how do I convert both 403b's to Roths at V? The Third Party Administrator claims I need to fill out 2 copies of a form showing the reason for a 403b withdrawal and they will sign it after verifying with my district that I am over 59 1/2, then they will send it to each vendor who is supposed to know what to with it. They say I can mail the rest of the paperwork to initiate the transfers to the destination vendor, V, who will take care of the transfers. For the 403b at V, I can roll it over to my traditional IRA at V, then to a Roth at V. Vendor V says all I need is their 403b roll-over form and they already can see I am over 59 1/2. For the 403b at B, I can either transfer it to the 403b at V (I question this because of the missing Information Sharing Agreement), then to the traditional IRA at V, then to a Roth at V. I could also roll it over to a traditional IRA at B to get it out of the employer restrictions (they also see my age), then transfer that to the traditional IRA at V, then the Roth at V. I don't see why the Third Party Administrator needs to "approve" anything. Does anyone see any problems with the italicized steps above or have any alternate suggestions? I know I could skip some of the steps, but remember, I want to be able to re-characterize back into a traditional IRA. I also don't want to run afoul of any regulations. Thanks, celia
  6. Morgan, Check to see that the contribution was withheld from your pay. Has anything changed since the previous paycheck? vendor(s) you are using? dollar amount? fund(s) the money is going into? new Third Party Administrator? new payroll software? new employer? celia
  7. In this case, the reporter asked the question and is the source of this topic. We are reporting an answer for him/her. This board can be thought of as a newspaper and we are writing the articles. We got the idea for these articles from an anonymous source! However, your comment, Sierra, brought up an interesting twist I didn't originally think of. celia
  8. I thought the purpose of the new regs was to prevent abuse of the system by participants who have more than one 403b plan and borrows from more than one. Without the plans knowing about the other plans the employee has, the employee can borrow $50,000 from each plan (the maximum, I believe) rather than $50,000 total (from all plans). I understood that the Information Sharing Agreements were supposed to facilitate information sharing between the vendors so they could prevent these excess loans. Instead, we are seeing some mutual funds not signing ISAs since they wouldn't be able to keep the details of each one separate and could become liable.
  9. ricky.bobby and Tony made good suggestions for your situation. I agree you should set aside 3-6 months living expenses (maybe even more), get term life insurance for both of you if you don't have it, then fund Roth IRAs for both of you. Since you are looking for the smart way to invest, you obviously want to learn whatever you can. It wouldn't hurt to ask your dad's broker what funds he recommends for you AND WHY. See if you agree with his rationale and risk tolerance. (We'd even be interested in hearing about his thoughts.) Then I'm sure you can find similar funds within Vanguard without loads. Several people on this board are good at identifying which funds in Vanguard match particular goals.
  10. Nick, This is where it's now your turn to speak up (like many of us have) and ask your district to sign an information sharing agreement with a low cost mutual fund company. You may have to help educate the person in charge of this at your district. Then, we'd be interested in hearing your district's response.
  11. Rob, I'm pretty sure that besides not being able to put money into "someone else's" 403b (your wife's), you also can't put money into a 403b set up for a different employer (your wife's previous employer). The reason I think this was that I was putting money into a 403b at Vanguard when I decided to change the amount of my contribution. It took me a few months to realize that the money was going into a new 403b account at Vanguard (I wasn't checking my Vanguard accounts very often at that time, just my pay stub). When I looked into why this was happening, I found out that my change in contributions did not trigger it. My contributions that are withheld through my school district were being processed by the county payroll system (at LACOE), and someone at Vanguard was taking the LACOE contribution list each month and manually adding my share to my account. One month, they "decided" that my employer (and employer number) had changed from LACOE to my school district. I had to convince them that my employer had not changed (that I was working for the same school district the whole time) before they would combine the two accounts into one. I was told that this happened to other employees of my district too and it was just a coincidence that it happened the same month I changed my contribution amount (at the end of a calendar year). By the way, if this happens to anyone else, I suggest you check your statements carefully as Vanguard had problems backing out my money from the new account and putting it into the old account as the date and NAV for each date kept changing with each correction they made. So why not open a new 403b at Vanguard and put new money into it, if that's what you want. So, you'll have another account. After you resolve the fee issue at AXA Equitable to your satisfaction and are ready to do a transfer, then you can transfer it into this new 403b.
  12. celia

    403b Cancelled

    Teeatch, If the new choices aren't that good, why would you transfer your existing account to the new place? Keep the old 403b, if you are happy with it, even if you can't add new money to it.
  13. Marcel writes: It sounds like Marcel is the "professional" here and we should be asking him/her this question because, after all, that is the business he/she is in. Marcel, Why don't you have the client call the new vendor and ask how to do the rollover. They will do it for the client since they would want to manage more money. You don't need to do anything!
  14. I received my reply from Vanguard and posted it in a new thread called "Vanguard Response". If anyone else wrote to them and got the same or a different response, I would like to hear about it.
  15. Intruder asks This was the possibility being discussed in the referenced article, intruder.
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