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I believe teachers are naive and insurance agents find they easy prey to sell them variable annuities with high fees.

 

They do it to make the commission. I want to switch into fidelity from horace mann.

 

who has account with fidelity and what mutual funds are you in? I would like to find out more to get the funds with lowest fees. Horace Mann tried to say that their are hidden 12(b) fees in regular mutual funds, does anyone know anything about this or is this just a scare tactic? They offered me a 3% fixed annuity with no fees to stay with them, you're thoughts?

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I believe teachers are naive and insurance agents find they easy prey to sell them variable annuities with high fees.

 

They do it to make the commission. I want to switch into fidelity from horace mann.

 

who has account with fidelity and what mutual funds are you in? I would like to find out more to get the funds with lowest fees. Horace Mann tried to say that their are hidden 12(b) fees in regular mutual funds, does anyone know anything about this or is this just a scare tactic? They offered me a 3% fixed annuity with no fees to stay with them, you're thoughts?

 

 

The sharks will tell you anything to get you to buy their product. They ONLY think about themselves. 20 years ago when I was in your place, I knew that it was wrong for this agent to tell me with a straight face that she would never recommend mutual funds to teachers because they are too risky. That was my aha moment. I never talked to one of those rip off artists again. I made it a life long committment to learn to invest myself and teach other teachers to stay away from those holigans.

If I had fidelity, I would invest in the total stock market index, the total international stock market index and according to your age, if you are 45, for example, about 45% in the total bond market index.

 

Very simple portfolio for a 45 year old :

35% in the Total Stock Market Index

20% in the Total International stock market index

45% in the Total bond market index.

 

Then once a year or so, rebalance to this allocation. When you reach 50, increase your bond allocation and reduce your equity allocation. You get broad deversification with low costs because with an index, there is little or no trading because there is no manager to mess things up. You strive to get the market averages. If only I got the averages over the years, I would have had twice in my portfolio, but because of stupid mistakes in learning this stuff with the first buying two fixed annuities and paying $6000 in surrender fees, I only earned less than the market averages. So much for the hucksters that are lurking EVERYWHERE.

 

Hope this helps,

Steve

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Fidelity Spartan expense ratios:

 

Total Stock Market: .10%

Total International Stock Market: .20%

Total Bond Index: .22%

 

I have all three of these, as does my wife.

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I believe teachers are naive and insurance agents find they easy prey to sell them variable annuities with high fees.

 

They do it to make the commission. I want to switch into fidelity from horace mann.

 

who has account with fidelity and what mutual funds are you in? I would like to find out more to get the funds with lowest fees. Horace Mann tried to say that their are hidden 12(b) fees in regular mutual funds, does anyone know anything about this or is this just a scare tactic? They offered me a 3% fixed annuity with no fees to stay with them, you're thoughts?

 

 

The sharks will tell you anything to get you to buy their product. They ONLY think about themselves. 20 years ago when I was in your place, I knew that it was wrong for this agent to tell me with a straight face that she would never recommend mutual funds to teachers because they are too risky. That was my aha moment. I never talked to one of those rip off artists again. I made it a life long committment to learn to invest myself and teach other teachers to stay away from those holigans.

If I had fidelity, I would invest in the total stock market index, the total international stock market index and according to your age, if you are 45, for example, about 45% in the total bond market index.

 

Very simple portfolio for a 45 year old :

35% in the Total Stock Market Index

20% in the Total International stock market index

45% in the Total bond market index.

 

Then once a year or so, rebalance to this allocation. When you reach 50, increase your bond allocation and reduce your equity allocation. You get broad deversification with low costs because with an index, there is little or no trading because there is no manager to mess things up. You strive to get the market averages. If only I got the averages over the years, I would have had twice in my portfolio, but because of stupid mistakes in learning this stuff with the first buying two fixed annuities and paying $6000 in surrender fees, I only earned less than the market averages. So much for the hucksters that are lurking EVERYWHERE.

 

Hope this helps,

Steve

 

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I believe teachers are naive and insurance agents find they easy prey to sell them variable annuities with high fees.

 

They do it to make the commission. I want to switch into fidelity from horace mann.

 

who has account with fidelity and what mutual funds are you in? I would like to find out more to get the funds with lowest fees. Horace Mann tried to say that their are hidden 12(b) fees in regular mutual funds, does anyone know anything about this or is this just a scare tactic? They offered me a 3% fixed annuity with no fees to stay with them, you're thoughts?

 

 

The sharks will tell you anything to get you to buy their product. They ONLY think about themselves. 20 years ago when I was in your place, I knew that it was wrong for this agent to tell me with a straight face that she would never recommend mutual funds to teachers because they are too risky. That was my aha moment. I never talked to one of those rip off artists again. I made it a life long committment to learn to invest myself and teach other teachers to stay away from those holigans.

If I had fidelity, I would invest in the total stock market index, the total international stock market index and according to your age, if you are 45, for example, about 45% in the total bond market index.

 

Very simple portfolio for a 45 year old :

35% in the Total Stock Market Index

20% in the Total International stock market index

45% in the Total bond market index.

 

Then once a year or so, rebalance to this allocation. When you reach 50, increase your bond allocation and reduce your equity allocation. You get broad deversification with low costs because with an index, there is little or no trading because there is no manager to mess things up. You strive to get the market averages. If only I got the averages over the years, I would have had twice in my portfolio, but because of stupid mistakes in learning this stuff with the first buying two fixed annuities and paying $6000 in surrender fees, I only earned less than the market averages. So much for the hucksters that are lurking EVERYWHERE.

 

Hope this helps,

Steve

 

but would it be better to just leave the money in the variable annuity if you're around 50 years old and have under $40,000 in there and start a new 403(b) with fidelity in mutual funds and not pay the surrender charges which are very high?

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I believe teachers are naive and insurance agents find they easy prey to sell them variable annuities with high fees.

 

They do it to make the commission. I want to switch into fidelity from horace mann.

 

who has account with fidelity and what mutual funds are you in? I would like to find out more to get the funds with lowest fees. Horace Mann tried to say that their are hidden 12(b) fees in regular mutual funds, does anyone know anything about this or is this just a scare tactic? They offered me a 3% fixed annuity with no fees to stay with them, you're thoughts?

 

 

The sharks will tell you anything to get you to buy their product. They ONLY think about themselves. 20 years ago when I was in your place, I knew that it was wrong for this agent to tell me with a straight face that she would never recommend mutual funds to teachers because they are too risky. That was my aha moment. I never talked to one of those rip off artists again. I made it a life long committment to learn to invest myself and teach other teachers to stay away from those holigans.

If I had fidelity, I would invest in the total stock market index, the total international stock market index and according to your age, if you are 45, for example, about 45% in the total bond market index.

 

Very simple portfolio for a 45 year old :

35% in the Total Stock Market Index

20% in the Total International stock market index

45% in the Total bond market index.

 

Then once a year or so, rebalance to this allocation. When you reach 50, increase your bond allocation and reduce your equity allocation. You get broad deversification with low costs because with an index, there is little or no trading because there is no manager to mess things up. You strive to get the market averages. If only I got the averages over the years, I would have had twice in my portfolio, but because of stupid mistakes in learning this stuff with the first buying two fixed annuities and paying $6000 in surrender fees, I only earned less than the market averages. So much for the hucksters that are lurking EVERYWHERE.

 

Hope this helps,

Steve

 

but would it be better to just leave the money in the variable annuity if you're around 50 years old and have under $40,000 in there and start a new 403(b) with fidelity in mutual funds and not pay the surrender charges which are very high?

 

 

The amount is beside the point, actually the less you have the more you should take it out, as long as you know where its going, knowing the risks in mutual fund investing and how the stock market works. It also depends on the terms in the contract you signed. How much is the surrender fee, 5%, 20%? Can you take it out over time without the surrender fee? At 50 years old, your longevity may be another 40 years, thats a long time in an annuity, you will never get what the insurance company gets in the stock market. Remember in down markets, which has been ONLY 3 years in the last 18 years in the coffeehouse invester portfolio, you get 0% gain, but its crucial to know that in any annuity, you will never get the market returns. Again, depending on the contract you sign, not what the sales person promises, you might get half of the actual market gain. Thats a HUGE fee to "play it safe." Fees are the major risks in investing.

Here is the coffehouse invester returns over the last 18 years. My link

FYI, coffeehouse investor is just one of many examples of low cost index investing that are diversified across all of the major asset classes.

 

1992 9.57%

1993 15.65%

1994 -0.58%

1995 22.90%

1996 14.53%

1997 17.95%

1998 6.89%

1999 8.30%

2000 7.25%

2001 1.88%

2002 -5.56%

2003 23.54%

2004 13.80%

2005 6.24%

2006 15.15%

2007 2.63%

2008 -20.21%

2009 20.26%

2010 14.68%

 

But its your call. I took my out when I was about 47 and am glad I did, but I read up on investing and knew the risks involved.

You can too.

 

2 cents,

Steve

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I believe teachers are naive and insurance agents find they easy prey to sell them variable annuities with high fees.

 

They do it to make the commission. I want to switch into fidelity from horace mann.

 

who has account with fidelity and what mutual funds are you in? I would like to find out more to get the funds with lowest fees. Horace Mann tried to say that their are hidden 12(b) fees in regular mutual funds, does anyone know anything about this or is this just a scare tactic? They offered me a 3% fixed annuity with no fees to stay with them, you're thoughts?

 

 

The sharks will tell you anything to get you to buy their product. They ONLY think about themselves. 20 years ago when I was in your place, I knew that it was wrong for this agent to tell me with a straight face that she would never recommend mutual funds to teachers because they are too risky. That was my aha moment. I never talked to one of those rip off artists again. I made it a life long committment to learn to invest myself and teach other teachers to stay away from those holigans.

If I had fidelity, I would invest in the total stock market index, the total international stock market index and according to your age, if you are 45, for example, about 45% in the total bond market index.

 

Very simple portfolio for a 45 year old :

35% in the Total Stock Market Index

20% in the Total International stock market index

45% in the Total bond market index.

 

Then once a year or so, rebalance to this allocation. When you reach 50, increase your bond allocation and reduce your equity allocation. You get broad deversification with low costs because with an index, there is little or no trading because there is no manager to mess things up. You strive to get the market averages. If only I got the averages over the years, I would have had twice in my portfolio, but because of stupid mistakes in learning this stuff with the first buying two fixed annuities and paying $6000 in surrender fees, I only earned less than the market averages. So much for the hucksters that are lurking EVERYWHERE.

 

Hope this helps,

Steve

 

What about the fidelity freedom funds, are the fees too high at around .75%? Should people stay away from those and try to just get in spartan funds?

 

How do you tell the school you're account # for fidelity after you open an account with fidelity. Will the school know where to direct the money for the 403(b) if you open a new account with fidelity via mail?

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What about the fidelity freedom funds, are the fees too high at around .75%? Should people stay away from those and try to just get in spartan funds?

 

How do you tell the school you're account # for fidelity after you open an account with fidelity. Will the school know where to direct the money for the 403(b) if you open a new account with fidelity via mail?

 

 

The fidelity freedom fund 2040 is .81%: My link

Then add on the districts TPA cost and it will probably be over a 1%. But check with your district and ask what the cost total cost is to you.

The freedom funds are a good way for you to have a manager rebalance your portfolio for you as you age. However, they are not cheap and you have to look at the allocation of stocks to bonds, not only the year. Some funds are too risky for people getting ready to retire for example. The TR Price 2010 had 63% in equities, thats way too aggressive and they were critisized because people took a big hit in the 2008 crash.

 

The school district will know what to do to open up your new account with any company that is on the 403b list, either by mail, email, telephone or online. For my district, you have to also call the company that you want to invest in and open the account.

 

Steve

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Steven,

I am curious as to why you are not looking in to Pension2 with CALSTRS? Even if Horace Mann offers Fidelity funds, they are still tacking on their fees in addition to the Fidelity fees. I just went through this process. You might want to check out the recent thread on this board regarding questions about rolling over from Nationwide to Pension2. I received some great information from board regulars.

 

I may be misunderstanding your post, however. If you can invest DIRECTLY with Fidelity (most of us can't now), that would be a fabulous way to go.

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