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Took the school long enough to give my wife the information she requested weeks ago. Here are the contents of the letter:

 

************************************************************

 

TAX SHELTER ANNUITIES

 

Tax shelter annuities are available to all full and part time employees of the school district.

If you would like to arrange for a portion of your earnings to be contributed to a tax shelter annuity, you may contact any of the companies listed below. The district makes no recommendations concerning either agents or institutions.

 

ING

AXA

Travelers/Met Life

Union Central

Ameriprise Financial Services

R & R Financial Planners

Fidelity Investments

 

**************************************************************

 

Even though they offer NY State 457 plan, they make no mention of it. They offer no recommendation, but all they talk about is TSA's.

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Jarheads --

 

Re: TSA language, I understand that much of the IRS regulations refer to TSAs. (I objected to the terminology in my district, and that was their response.) Unfortunately, the poor sops who run these things for the district -- busness office, payroll, or their benefits consultants, usually -- don't have a clue why the terminology should be altered to be more inclusive.

 

Looks like she has Fidelity as an option, tho! Lucky you! That's a decent family with decent choices, which is better than a lot of us have. Go for it!

 

JudyS

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Hi,

Regarding the use of TSA, about 8 years ago, we got LAUSD to change our paystub label from using TSA to 403b by simply saying that the district is indeed making a recommendation to only annuities from insurance companies when there are custodial accounts with mutual fund companies. Your wifes district is recommending TSAs when on their list in plain sight is Fidelity Investments. Employees would not be aware of the distinction and the TSA agents would never say to a potential victim that Fidelity is available.

Point this out to the district and lets us know what they say.

Good luck,

Steve

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Guest Sierra

Took the school long enough to give my wife the information she requested weeks ago. Here are the contents of the letter:

 

************************************************************

 

TAX SHELTER ANNUITIES

 

Tax shelter annuities are available to all full and part time employees of the school district.

If you would like to arrange for a portion of your earnings to be contributed to a tax shelter annuity, you may contact any of the companies listed below. The district makes no recommendations concerning either agents or institutions.

 

ING

AXA

Travelers/Met Life

Union Central

Ameriprise Financial Services

R & R Financial Planners

Fidelity Investments

 

**************************************************************

 

Even though they offer NY State 457 plan, they make no mention of it. They offer no recommendation, but all they talk about is TSA's.

 

=====================================================================

 

Jar,

 

How DO the employees find out about the fact that the employer has OFFICIALLY opted into the 457(b) Plan and that all the individual has to do is go to the website to join?

 

Peace and Hope,

Joel

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Jar,

 

How DO the employees find out about the fact that the employer has OFFICIALLY opted into the 457(b) Plan and that all the individual has to do is go to the website to join?

 

Peace and Hope,

Joel

 

Joel,

Good question... As you can see, they don't "advertise" it. The only reason I found out about the avalability of 457 plan is because you told me to inquire. I will ask my wife to contact the administration and insist that they add 457 plan to the list.

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Just a positive, we have new paycheck stubs now and they say 403B not TSA!!! One small step in the right direction....whoooooo!

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I had my wife send an email about adding Vanguard as a vendor:

 

"How can we go about adding Vanguard as a vendor and why is the district "promoting" annuities through life insurance companies. Most important, why is the New York State Deferred Compensation 457 plan not listed when it is far superior than any of the life insurance companies?"

 

Reply:

 

"Due to new regulations on 403B's we are not adding any new vendors to the 403b list. However, the district does not promote any of the specific vendors. You may choose any one from the list. The 403b was originally design by the government as an annuity type product and therefore many of the vendors offer annuity products.

 

 

The NYS Deferred Compensation program is entirely different and is a 457 plan.

 

 

Employees may participate in either or in both.

 

Joan L. Colvin, Ed. D.

 

Assistant Superintendent for Business Services"

 

*************************************************

 

I love the part where she says: "you may choose any one from the list". But if 457 plan is not on the list how are teachers supposed to know that it's offered?

 

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Guest Sierra

I had my wife send an email about adding Vanguard as a vendor:

 

"How can we go about adding Vanguard as a vendor and why is the district "promoting" annuities through life insurance companies. Most important, why is the New York State Deferred Compensation 457 plan not listed when it is far superior than any of the life insurance companies?"

 

Reply:

 

"Due to new regulations on 403B's we are not adding any new vendors to the 403b list. However, the district does not promote any of the specific vendors. You may choose any one from the list. The 403b was originally design by the government as an annuity type product and therefore many of the vendors offer annuity products.

 

 

The NYS Deferred Compensation program is entirely different and is a 457 plan.

 

 

Employees may participate in either or in both.

 

Joan L. Colvin, Ed. D.

 

Assistant Superintendent for Business Services"

 

*************************************************

 

I love the part where she says: "you may choose any one from the list". But if 457 plan is not on the list how are teachers supposed to know that it's offered?

 

 

Jar: Did you email her back, quoting what she said? Please let us know her answer.

 

Also tell her that while the annuity was the only permissible investment for 403b from 1959 to 1975 the mutual fund alternative has been a permissible alternative since 1975.

 

ASK HER: "HOW MANY MORE DECADES WOULD YOU LIKE US TO WAIT UNTIL YOU INCLUDE NO-LOAD MUTUAL FUNDS ON THE 403(b) INVESTMENT MENU?"

 

Best,

Joel

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Jar: Did you email her back, quoting what she said? Please let us know her answer.

 

Also tell her that while the annuity was the only permissible investment for 403b from 1959 to 1975 the mutual fund alternative has been a permissible alternative since 1975.

 

ASK HER: "HOW MANY MORE DECADES WOULD YOU LIKE US TO WAIT UNTIL YOU INCLUDE NO-LOAD MUTUAL FUNDS ON THE 403(b) INVESTMENT MENU?"

 

Best,

Joel

 

Joel,

I don't know if my wife will allow me to email her directly, but I will see if I can get her email address.

 

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You will also want to make certain that these are mutual funds offered by Fidelity directly, as opposed to Fidelity Advisor funds which add a layer of expenses and are sold only through brokers (though even the Advisor funds might be the least expensive of this bunch).

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I'm familiar with the NY 457 plan. It is absolutely superb and includes about six Vanguard funds. It's all your wife needs (which I think you realize).

 

Go with that, and tell as many teachers as you can to do likewise.

 

It seems to be, usually the case, that school administrators really don't understand this stuff, and go along with what the usual investing suspects (insurance companies selling annuities) tell them.

 

Good luck. Tim

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You will also want to make certain that these are mutual funds offered by Fidelity directly, as opposed to Fidelity Advisor funds which add a layer of expenses and are sold only through brokers (though even the Advisor funds might be the least expensive of this bunch).

 

BG,

They offer Fidelity Freedom lifecycle funds. My wife is going to invest in the 2030 fund even though she is looking to retire in 2020. I'd prefer that she does not touch the 457 immediately after her retirement.

 

 

I'm familiar with the NY 457 plan. It is absolutely superb and includes about six Vanguard funds. It's all your wife needs (which I think you realize).

 

Go with that, and tell as many teachers as you can to do likewise.

 

It seems to be, usually the case, that school administrators really don't understand this stuff, and go along with what the usual investing suspects (insurance companies selling annuities) tell them.

 

 

She stopped contributing to her 403b AXA plan and next pay period will start contributions to NY 457 plan with 100% going to Fidelity Freedom 2030 fund.

We are waiting to hear from the fee-only financial advisor how to handle the 403b account.

 

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Guest Sierra

 

You will also want to make certain that these are mutual funds offered by Fidelity directly, as opposed to Fidelity Advisor funds which add a layer of expenses and are sold only through brokers (though even the Advisor funds might be the least expensive of this bunch).

 

BG,

They offer Fidelity Freedom lifecycle funds. My wife is going to invest in the 2030 fund even though she is looking to retire in 2020. I'd prefer that she does not touch the 457 immediately after her retirement.

 

 

I'm familiar with the NY 457 plan. It is absolutely superb and includes about six Vanguard funds. It's all your wife needs (which I think you realize).

 

Go with that, and tell as many teachers as you can to do likewise.

 

It seems to be, usually the case, that school administrators really don't understand this stuff, and go along with what the usual investing suspects (insurance companies selling annuities) tell them.

 

 

She stopped contributing to her 403b AXA plan and next pay period will start contributions to NY 457 plan with 100% going to Fidelity Freedom 2030 fund.

We are waiting to hear from the fee-only financial advisor how to handle the 403b account.

 

 

TO ALL K-12 PUBLIC SCHOOL EMPLOYEES IN THE STATE OF NEW YORK

 

 

You have a great 457(b) plan run by the state. Your school district must first opt in, in order for you to gain the advantages of pre-tax investing with de minimis expense incurred by you, the investor. If your school district employer has not opted in lobby your school administrator to do so forthwith.

 

Q.: Do the nation's public school school administrators practice the same degree of dull dilligence when it comes to buying text books/supplies for the students' education as they practice with their employees' 403(b) Plan?

 

Peace and hope,

Joel L. Frank

Pension Columnist

The Chief-Civil Service Leader

277 Broadway

New York, NY 10007

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