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maximus9

403b Institutional Model

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What is the realistic probability that 403b in higher Ed could move into an institutional model similiar to those found in 457 and 401K and gain mainstream acceptance? There is definitely some systems that have adopted to release an RFP and curtail the number of vendors offered in their program to two, even one. I think its been proven enough that too much choice works in determent to the purpose of investing wisely. Isn't it high time that the higher ed community chose to follow a path set by 401k and 457 in the public sector and establish an unbundled program, offer institutionally priced mutual funds, and administered by one or two vendors? Getting K-12 to even consider this platform is a task only for the brave at heart.

In the long run participants would win from lower fees and better education.

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It will happen; it is happening--because 457 is a much wiser way to go than 403(b). The RFP route would ensure that the employer gets involved and does its duty in the best interest of their employees.

 

The 403b allows the employer to stand back and allow their employers to be handled by the "good old boy network." And that network serves the best interest of the salesforce--not the employee. Sure some agents provide basic advice--but their advice isn't always in the best interest of the teacher.

 

Too many districts believe that and agent holding the hand of the teachers is better than sending the teachers to a decent reading list and and a few good books and a few good websites. And too many districts hide behind the hold harmless agreements that only serve the status quo. Decision-makers are confortable with the status quo.

 

We all know that; It's been that way for a very long ago. Tune into what Steve is saying about Los Angles. But the battle is a long slog

 

Once again, I maintain that the numbers presented in a mountain chart to the teachers and others/the unions/the school boards/the voters should win the day. But so far, most teachers haven't tuned in and have fail to understand the power of protesting this terribly costly system. The loser is the teachers' stardard of living in retirement at the end of a 40 years of investing. A loss of almost 50% is just too much. Once the numbers are out there, everyone should be able to agree. Let's give the doityourselfers and no-load, low-cost option.

 

Ted

Ted

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