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  1. Murph, Glad you got a hoot out of my reaction. At least I was honest enough to respond to your questions and points. You, on the other hand did not bother to respond to my post of March 26 when I asked you some tough questions. That was when you were "JustMurph" instead of "Murph." I'm also glad that you love this web site. Enjoy it. In fact, you and the other salesmen can "have" it. I'm out of here. When I first came here, I thought that it would be one of the few places where teachers and other public sector employees could go for information and discussion without being subjected to the propaganda of "full service providers." It's not enough that we have to hear their drivel in staff lounges and watch unwitting colleagues get snookered into inappropriate investments. It's not enough that we watch our own union, the NEA, take Security Benefit's money and then send us ads touting their lousy "Valuebuilder" product. No, now we also have to put up with 403b salesmen here, too. For the rest of you folks here, consider this parting s: people like Joel, Joe, Steve, and French Teacher are not selling you anything. They receive no compensation. All that they are doing is sharing their experiences and helping others to make good decisions. On the other hand, people like TR and Murph are trying to sell you something. They have a financial incentive to do so. Consider the difference.
  2. TR, 1) If somebody else does "it," is it OK for me to do it? Damned right. I have no problem defending myself, especially against lightweights such as you and Murph. 2) Yes, I have indeed criticized front loads, back loads, 12b1s, surrender fees and the like. I will proudly plead guilty to that. After being egged on by you and Murph, I now am criticizing people like you, as well. 3) Comparing student homework to financial disclosure for adults is about as idiotic as comparing student achievement to investment returns. Coming from you, however, this is no great surprise. 4) How many times do I have to say that I am all in favor of giving people the choice between investing on their own and having professionals assist them? You and Murph need some serious help in reading comprehension. 5) And now, here is a question for you, dear professional: Do you invest in the same products that you sell to your clients? Do you pay front loads? Back loads? 12b1 fees? Surrender fees? If these are so good for your clients, do you pay them as well? 6) Here's another question for you: Would you sell such products to your own children?
  3. TR, 1) "Petty criticism?" Check out the latest post from Murph. 2) Until my last post, I did not spend much time criticizing people. I did spend time criticizing poor 403b options. I did spend time describing alternatives to the typical choices offered to teachers. I have repeatedly noted that some people need and/or want professional investment advice, and they should have access to it. 3) Investors in no load funds are indeed responsible for reading through disclosure notices. I would argue, however, that investors who pay for professional guidance should receive help in understanding disclosure. I wonder how often salesmen take their clients through the fine print of investment contracts. 4) I have, indeed, spent time trying to get my district to offer better choices for investors. I'm happy to say that, since Fidelity is now offered by my district, I won't be needing your services. I'm spreading the word about this, too, TR.
  4. OK, Murph, let's take off the gloves. 1) I can't even understand the first sentence that you wrote. The rest of your post indicates that you are in serious need of a refresher course in grammar and spelling. Perhaps you didn't pay much attention in English. 2) I get paid an eleven month salary for more than eleven months of work. I do not receive a paycheck in August. 3) Your comparison of student learning to investment returns is ridiculous. 4) My students have any number of choices when they graduate. They are going to community colleges, California State Universities, UC campuses, and private colleges that run the gamut from lower tier to Ivy League schools. You might be surprised to know that there is a pretty strong correlation between how much work students put in and where they end up in college. 5) My results, Murph, are indeed "there." I have five sections of AP classes, and virtually all of my students pass the AP exam. More than half of them earn the highest score of "5." About forty percent of them earn a "4." I have so many offers to do consulting work that I turn down nearly half of them (including two today). Comparing student learning to investment returns is ridiculous, as noted above, but if you want to make that comparison, I'll compare my results to yours any day. 6) Teachers like me persevere in spite of cretins like you. We love our jobs, and we work hard to overcome the attitudes that you displayed in your pathetic excuse of a post.
  5. FT, Thanks for those articles. I think that you are right about the need for fumigating the mutual fund industry on an overall basis. The charges against Vanguard, though, seem less serious. They apparently were not diligent enough in collecting money from various lawsuits. This seems less problematic than the charges against Fidelity (gifts from brokerage firms) and American. Here is a quotation about the American Funds issue: "Lockyer, taking a page from the Eliot Spitzer playbook, charged that American had not adequately disclosed the payments it made to brokerages to be on those firms’ preferred lists of fund families. As such, investors were not aware of the incentives their brokers had to recommend American Funds, Lockyer charged." Again, you are right about problems across the board. And in fairness, American has had a stellar reputation over many years.
  6. TR, " No one is making you buy these products!!!!! " Ah, but the problem, you see, is that in so many districts teachers MUST buy these products if they want to start a 403b account. They have no choice. "I think this sight would add far greater value to people who come here if the focus was on educating people about all their choices..." That is what many of us are doing. In so doing, we must point out the problems associated with some of the products that you may be selling. We are trying to educate folks (many of whom are new to investing) about surrender fees, 12b1 fees, front end loads, back end loads, and M&E charges. And, since you mention the importance about choices, some of us point out the alternatives to the products that you are selling. This is important because, for so many folks, the first exposure to investing comes from a salesman. I think that this site does a good job of balancing that information with the experiences of others who are able to invest on their own.
  7. "The 403(b) investor has to deal with more white shoe salesmen, then any other. The salesmen(and women) that are selling high commission products with only their personal interest in mind are truly disgusting. Add to that group the majority of 403(b) reps that counldn't invest their way out of a paper bag, but sell themselves as financial advisors." You know, it might make you feel better to say this. If it does, great. Just remember, though, the same could be said about teachers. Think about that the next time you make a comment like that. TR, I've been called many things in my life, but white shoe salesman is not one of them. Nor have I sold any high commission products to my students. And if I only had my own personal interests in mind, I would put in far fewer hours than I do in my job.
  8. I'm not Joel, but I can think of two reasons to avoid variable annuities within a 403b account: 1) High fees, esp. the typical 1.25% M&E charge. 2) Variable annuities are already a tax advantaged investment. Why put a tax advantaged investment inside another (403b) tax advantaged investment? That's like using an umbrella inside the house on a rainy day. So, if an investor does not benefit from this, guess who does?
  9. FT, I was unaware that Vanguard and Fidelity are under investigation. What are the allegations against them?
  10. FT, How would you feel about Fidelity as a single provider in your 403b plan if most of Fidelity's choices -- actively managed funds and index funds -- were available AND professional advice were available as well, as Dan has suggested? Would that provide sufficient choice? It sure would for me.
  11. Murph, I'll bet that you are referring to the American Funds. Yep, that is a solid outfit. No doubt about it. Even though the expense ratios are reasonable, though, the ~5% load is a substantial drag on returns. A $1000 investment starts out with being a ~$950 investment. I also have to point out that American Funds are under regulatory investigation for alleged wrongdoing. They insist that they have done nothing wrong and are challenging the allegations.
  12. I enjoy reading your posts, FT. We disagree on a number of issues, but you are reasonable and make a good case for your position. I do think that it can be difficult to follow good managers. James Craig and Peter Lynch, for example, are not even managing funds available to the public. We couldn't follow them even if we wanted to. Even when solid managers stay, their funds attract such an influx of money that the funds end up performing much like the indexes, but at higher cost.
  13. FT, I think that there are many who DO believe that past performance is virtually a guarantee. How else do you explain the lemming mentality of those who flock to the latest " funds?" And how do you explain the huge influx of money to such funds? ************************************************************ "But show me a manager whose fund has beaten its benchmark by a wide margin for the last ten years, and yeah, I'm interested." ************************************************************ What happens when the portfolio manager leaves? Talk to the folks who fell in love with the Janus Fund, headed by James Craig. Terrific manager, right? Look what happened when he left. And this is not an isolated case. Managers come and managers go all the time. Again, feel free to chase those guys. 403b plans should have such options for investors (which should include working with agents). Just please give me the option of simplifying things with low cost index funds.
  14. *********************************************************** "One small victory for us reps is the recent "outing" westerndad's connection with Vanguard...I knew there was something going on there...we have pics of him driving his Bently with a "I Love Vanguard" bumper sticker." *********************************************************** Murph, I resent the heck out of that. I'll have you know that I drive a Ferrari, and I wouldn't dream of being so tacky as to put a bumper sticker on it. The "full service provider" who sold me my first TSA, by the way, is also doing quite nicely, thank you. But he is driving a mere BMW. Peasant.
  15. *************************************************************** "A large majority...but not all of them...So, if you did find a managed fund that for the past 40-50 years has out-performed the index we should just ignore it?" *************************************************************** Yep, that's what I'm suggesting. Past performance is no guarantee of future returns. I am perfectly happy to capture the entire return (less fees) of an asset class without trying to predict, from thousands of funds, the minority that will overperform. By all means, feel free to try to make those predictions. *************************************************************** "We're not talking about a couple of years here...were talking decades. With a beta of .80 which means I've taken less risk, experienced lower volatility AND I've got more money in my account at the end of the day." *************************************************************** With proper diversification among different asset classes, it is perfectly possible (and easy) to develop a portfolio of index funds that reduces risk and volatility, AND at a fraction of the cost of the more expensive funds. ************************************************************ "Don't get me wrong, index funds are a fine option - but they are not the panacea that this board [sometimes] makes them out to be." *********************************************************** No doubt: index funds are no panacea. But I sure want my (and my wife's) 403b plan to include them. And therein lies the problem: Too many districts do not even provide this option.
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