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Aloha folks! So I learned a new term today... Thanks to this forum and the kind folks here, I started my journey toward fiscal responsibility and found out about my state's 457 "deferred compensation" program and a better 403b option with lower fees and better investment options. I got the 403b new account open and redirected my pre-tax savings into it. Now that that's squared away, I'm finally getting the exchange paperwork done. When I requested the paperwork and the account numbers, the advisor that set up the original 403b contract has suggested the use of a "free corridor" to avoid surrender fees. When I looked up the term, it seems as though surrender fees can vary from contract to contract... some fees drop off completely after a certain amount of time, and some reduce by steps year after year depending on a certain amount of time. Near as I can tell, my contract with AXA specifies that the surrender fee won't fall off until after year 7, and I'm only in year 4. From other internet reading, for some contracts, surrender fees are applied to the date of the monies being deposited , not necessarily the date of the contract start.... so "free corridor" is the money that can be transferred without surrender fees, which can be done in incrementally. The way I look at it now, my surrender fees are high, but not as bad as leaving the money in the account.... where I'd be accumulating an annual fee, expense ratios, and a quarterly penalty for an account under $XX,000. Haha... so my answer to my own question is... it's not worth it for me according to the math. So now, near as I can tell, I have all the information and paperwork that each provider and my state's TPA requires to get this done. Whew!
Hi all! I have a nephew heading off to his first year in college, and I've got about a decade before my singleton will be doing the same. In the process of searching up 403bs, 457s, 401ks, and IRAs I also started reading up about 529s and just discovered that we do have a Hawaii-based option. It's not pre-tax, but it is tax-deferred on the earnings for federal/state taxes. Hilariously to me, after all the fuss with trying to find 403 providers with the lowest fees and ERs, the HI 529 investment options are all Vanguard. Apparently we have age-based options and we also have a small selection to build our own portfolio. One can also make a smaller initial investment instead of Vanguard's minimums if purchasing from them directly. Where our 403/457s initally go through National Benefits, the 529 goes through a company called Ascensus Broker Dealer Services. So many onion layers.