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Christmas Has Come Early

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After many years of trying, 10 years to be specific, I finally succeded in getting Fidelity Investments as our 457 plan vendor. I work for a local government and we will deal directly with Fidelity, no middleman. While ICMA-RC and Nationwide are the dominant force around where I work, I passed them up due to the higher expenses. I also noticed to other not so popular vendors, Citibank and ING.

 

I showed the administration the impact of fees and what is does to your account after the course of many years. They saw the light and did not want their hard earned money confiscated by exorbitant fees either. It's amazing what a difference an informed, receptive and caring administration can do for it's employees.

 

We will have access to all Fidelity Funds and more importantly the index funds that charge ten basis points. Fidelity will charge each acct. participant $24.00 per year as an account maintenace fee, no matter how many funds you have selected to invest in, it could be 1 fund or 10 funds. In addition to the 24.00 fee, you will be charged the underlying expense ratio(s) for the fund(s) you choose. I believe they may even waive the fee once the account reaches a certain minimum. What a great plan!

 

My next mission is to get Fidelity added to my wife's school district's vendor list. They currently offer AXA Advisors as the only 457 vendor, that agent successfully snared 10 people. The district will gladly add Fidelity but requires 10 participants. I would love to speak with the AXA participants and find out if they know what they are being charged, don't bet on it. AXA charges nose bleed fees, expenses, surrender charges and a several hunded page prospectus that will make you dizzy and poor!

 

Fortunately my efforts have paid off and we will reap the benefits. The employees in my agency will NOT be subject to those ridiculous fees that equate to nothing more than money is some agents pockets or insurance companies coffers. I hope others will be as fortunate as I am.

 

Wife has Vanguard for her 403b and I have Fidelity, what a great combination. Christmas has come early!

 

 

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Guest Sierra

After many years of trying, 10 years to be specific, I finally succeded in getting Fidelity Investments as our 457 plan vendor. I work for a local government and we will deal directly with Fidelity, no middleman. While ICMA-RC and Nationwide are the dominant force around where I work, I passed them up due to the higher expenses. I also noticed to other not so popular vendors, Citibank and ING.

 

I showed the administration the impact of fees and what is does to your account after the course of many years. They saw the light and did not want their hard earned money confiscated by exorbitant fees either. It's amazing what a difference an informed, receptive and caring administration can do for it's employees.

 

We will have access to all Fidelity Funds and more importantly the index funds that charge ten basis points. Fidelity will charge each acct. participant $24.00 per year as an account maintenace fee, no matter how many funds you have selected to invest in, it could be 1 fund or 10 funds. In addition to the 24.00 fee, you will be charged the underlying expense ratio(s) for the fund(s) you choose. I believe they may even waive the fee once the account reaches a certain minimum. What a great plan!

 

My next mission is to get Fidelity added to my wife's school district's vendor list. They currently offer AXA Advisors as the only 457 vendor, that agent successfully snared 10 people. The district will gladly add Fidelity but requires 10 participants. I would love to speak with the AXA participants and find out if they know what they are being charged, don't bet on it. AXA charges nose bleed fees, expenses, surrender charges and a several hunded page prospectus that will make you dizzy and poor!

 

Fortunately my efforts have paid off and we will reap the benefits. The employees in my agency will NOT be subject to those ridiculous fees that equate to nothing more than money is some agents pockets or insurance companies coffers. I hope others will be as fortunate as I am.

 

Wife has Vanguard for her 403b and I have Fidelity, what a great combination. Christmas has come early!

 

 

IT IS SIMPLY AMAZING THAT YOU HAD TO SPIT BLOOD TO GET WHAT MANAGEMENT SHOULD HAVE GIVEN YOU UNILATERALLY. IT REVEALS JUST HOW FAR OUT TO LUNCH THESE ADMINISTRATOR TYPES ARE AND HAVE BEEN. HOW INVOLVED WAS YOUR UNION?

 

Peace and hope,

Joel

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My union was not involved at all. Over the past several years I have approached the folks in charge at the time, and could not get the plan implemented due to their lack of knowledge and interest. We are new to the 457b and have never had one prior to this. I always knew the benefits of one but could not convince the prior administrations to implement one for everyones benefit. A new administration has come into power, this is the third one during my tenure and I approached the people right at the top and to my surprise the answer was not only YES, but yes to whom I thought the best candidate would be.

 

Needless to say I was in disbelief, but I tried not to get too excited. My third attempt to get this plan began back in October of 2006 and the third time was a charm.

 

My decision was easy. None of the others compared to Fidelity when it came to fees. The ICMA field rep. for my area was astonished when I declined interest in ICMA due to the higher fund expenses. ICMA charges .55% of the total account balance on a yearly basis. In addition you pay the fees associated with the funds you invest in, plus an annual account maintenance fee of 36.00 per year. I know that when compared to the horrific annuities teachers get stuck with, ICMA looks like a much better alternative. But I was not settling for just okay, I wanted the most bang for my buck and the best plan available for my co workers and Fidelity came out the undisputed winner, Vanguard is not a player in the 457 market.

 

When I used for example an S&P500 index thru ICMA the fees came out to 1.01% for an index funds! I was not impressed at all. I am comparing apples to apples and this is way too high for an index fund. I invest my personal money in Vanguard's Total stock market Index and they charge .19 basis points. So ICMA wants nearly five times as much in fees to own a somewhat similar fund minus the small and mid cap exposure that you do not get in the S&P 500. Fidelity's index funds charge a rock bottom 10 basis points and as a new start up they are giving us access to these funds and all the other ones with no minimum requirements.

 

ICMA and Nationwide were somewhat similar in expenses, they were not cheap enough compared to Fidelity.

 

 

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Way to go, ft! I am doing exactly the same thing with my district, too. I've communicated with the district's financial director who, last I heard, was contacting Fidelity. I'm hoping that my district will get the same terrific plan that yours got! Fidelity would be such great 457 alternative to NEA Value Killer.

 

Slowly but surely, one person at a time, one district at a time, things are starting to change.

 

Again, congratulations on a job well done.

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Way to go, ft! I am doing exactly the same thing with my district, too. I've communicated with the district's financial director who, last I heard, was contacting Fidelity. I'm hoping that my district will get the same terrific plan that yours got! Fidelity would be such great 457 alternative to NEA Value Killer.

 

Again, congratulations on a job well done.

 

 

Thanks and I wish you the best of luck!

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My union was not involved at all. Over the past several years I have approached the folks in charge at the time, and could not get the plan implemented due to their lack of knowledge and interest. We are new to the 457b and have never had one prior to this. I always knew the benefits of one but could not convince the prior administrations to implement one for everyones benefit. A new administration has come into power, this is the third one during my tenure and I approached the people right at the top and to my surprise the answer was not only YES, but yes to whom I thought the best candidate would be.

 

Needless to say I was in disbelief, but I tried not to get too excited. My third attempt to get this plan began back in October of 2006 and the third time was a charm.

 

My decision was easy. None of the others compared to Fidelity when it came to fees. The ICMA field rep. for my area was astonished when I declined interest in ICMA due to the higher fund expenses. ICMA charges .55% of the total account balance on a yearly basis. In addition you pay the fees associated with the funds you invest in, plus an annual account maintenance fee of 36.00 per year. I know that when compared to the horrific annuities teachers get stuck with, ICMA looks like a much better alternative. But I was not settling for just okay, I wanted the most bang for my buck and the best plan available for my co workers and Fidelity came out the undisputed winner, Vanguard is not a player in the 457 market.

 

When I used for example an S&P500 index thru ICMA the fees came out to 1.01% for an index funds! I was not impressed at all. I am comparing apples to apples and this is way too high for an index fund. I invest my personal money in Vanguard's Total stock market Index and they charge .19 basis points. So ICMA wants nearly five times as much in fees to own a somewhat similar fund minus the small and mid cap exposure that you do not get in the S&P 500. Fidelity's index funds charge a rock bottom 10 basis points and as a new start up they are giving us access to these funds and all the other ones with no minimum requirements.

 

ICMA and Nationwide were somewhat similar in expenses, they were not cheap enough compared to Fidelity.

 

ft,

 

What I really like is that you AVOIDED THE MIDDLEMAN, and thus passed the savings on to the employees. No need for a third party administrator, is there? You just went directly through Fidelity, in effect allowing employees to bypass the intermediary. What a concept!

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