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Buck

 

At some point this has to end but I admire your enthusiasm.

 

I would leave your wife's account alone. If she is getting a match then chances are she will come out ahead even with higher fees. I would definetly have her contribute up to the match.

 

 

Please let us know in a month whay you decided on.

 

 

Tony

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Kat---that is exactly what I'm going to do. Sucky thing is that I'm going to have to come up with $3,000 to begin the ROTH! I've got to put money into my girls 529 as well! This investing is expensive!

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Kat---that is exactly what I'm going to do. Sucky thing is that I'm going to have to come up with $3,000 to begin the ROTH! I've got to put money into my girls 529 as well! This investing is expensive!

 

 

 

Gosh another post. I anm really sorry folks.

 

Buck. I think if you set up an automatic monthly withrawal from your bank account you might be able to get in without the minimum of 3,000. Call them to find out.

 

If I am wrong you might start out with one of their funds that only require 1,ooo to get in and later you can transfer. One such fund is the star fund which is a good fund.

 

Call them.

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I called 1st investors back again and they ASSURED me that there would be NO FEES on my money, it will just ride the stock market--Good News I guess. I'm calling the others on my list to see if I can find a place with much lower fees.

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I called 1st investors back again and they ASSURED me that there would be NO FEES on my money, it will just ride the stock market--Good News I guess. I'm calling the others on my list to see if I can find a place with much lower fees.

 

 

 

Buck...Buck...Buck...no fees perhaps, but there will be an expense ratio, and it will probably be well over 1%. NO company is going to just hold your money, send you statements, and not take a cut in some way! You are way too trusting. The person on the other end of the phones doesn't know what he/she is talking about. I know we've advised you to let it sit because you don't really have any alternatives, but don't trick yourself into believing that you are not paying for it.

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I called 1st investors back again and they ASSURED me that there would be NO FEES on my money, it will just ride the stock market--Good News I guess. I'm calling the others on my list to see if I can find a place with much lower fees.

 

 

If you tell me what First Investors Funds you're in-I can show you what you are being charged. Sorry I am late to this thread, Buck-I am a CFP that does fee only planning. The company is charging you but the charge is hidden inside the fund. It's in a disclsure document called the prospectus which if you tell me the name of the fund I can show you what you're charged. They can say they keep your funds for "free" but it's BS semantics. The whole financial industry-save low cost Mutual Funds like Vanguard and DFA are hucksters. That's why I only sell advice and not products. I protect people from the financial sevices industry.

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Buck

 

At some point this has to end but I admire your enthusiasm.

 

I would leave your wife's account alone. If she is getting a match then chances are she will come out ahead even with higher fees. I would definetly have her contribute up to the match.

 

 

Please let us know in a month whay you decided on.

 

 

Tony

 

 

If you'd like to disclose what her other options are I may be able to help. Leaving it as is may not be the best thing-what are the other choices?

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Marc

 

Of course you are right . I was just giving the quick answer. Isn't it generally true that if you get a match even if the expense ratio of your choices are somewhat higher than average you still should invest up to the match?

 

I am impressed. You seem to say the right things. You seem ethical. I guess there are some good advisors out there.

 

 

Tony

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Marc

 

Isn't it generally true that if you get a match even if the expense ratio of your choices are somewhat higher than average you still should invest up to the match?

 

Tony

 

 

Yes, it's free money!! But maybe some of the other choices for her are cheaper-so perhaps you get free money and cheap investments.

 

Thank you Tony-the percentage is small and believe me it is sometimes an uphill battle for those of us who choose to practice this way-because we are lumped in with the scoundrels. Doing the right thing is not always easy.

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Getting back to First Investors. Here's the link to their prospectus for all their funds. I like to look at the 10 year costs. Every mutual fund is required to use the same example: If you invested $10,000 for 1,3,5 & 10 years and earned 5%, what would the fees be? Most of the First Investors Funds cost around $2000 over 10 years. By contrast, Vanguard Funds usually are around $200-250. So First Investors is charging 10x what Vanguard does. Are they 10x better? Of course not. They are just scoundrels feeding on the uninformed. Now you are informed-so pay it forward and inform your colleagues.

 

First Investots Prospectus

 

Under each fund they give "Example" This is where I get the info. You will never see this on a statement-it is taken out of your investment prior to computing the return you actually receive. Your friendly 403b rep will never point this out to you. Gee I wonder why. They like their fees hidden. Well hidden. Ergo, IT AINT FREE!!!!!!!

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Well done, Mark, and I am the skeptic's skeptic! This is the best factual explanation I have ever seen about how insurance and investment companies rip us off through 403b's. When I tried to explain this to colleagues, it was difficult, because you could never actually "see" the fees on a line item, but everybody agreed that they were never realizing any gains on their investments. At one time, practically my entire school was with Valic! And that included me...never again. I hope that among us all, we can save a few hard-working young teachers from the pain we went through.

 

Thank you. Kat

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Getting back to First Investors. Here's the link to their prospectus for all their funds. I like to look at the 10 year costs. Every mutual fund is required to use the same example: If you invested $10,000 for 1,3,5 & 10 years and earned 5%, what would the fees be? Most of the First Investors Funds cost around $2000 over 10 years. By contrast, Vanguard Funds usually are around $200-250. So First Investors is charging 10x what Vanguard does. Are they 10x better? Of course not. They are just scoundrels feeding on the uninformed. Now you are informed-so pay it forward and inform your colleagues.

 

First Investots Prospectus

 

Under each fund they give "Example" This is where I get the info. You will never see this on a statement-it is taken out of your investment prior to computing the return you actually receive. Your friendly 403b rep will never point this out to you. Gee I wonder why. They like their fees hidden. Well hidden. Ergo, IT AINT FREE!!!!!!!

 

 

 

Boy that can really add up. I checked my expense ratios on my funds and they average to .48. I would guess thats pretty good? Why is expense ratio so hard to explain and so hard to understand???

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Why is expense ratio so hard to explain and so hard to understand???

 

 

If anybody knows compound interest, expense ratios can be explained easily. But the main reason our colleagues never understand it is because of the misleading, self serving sales pitches they get. Our colleagues know that its free (Buck still believe its free), they never lose money and the sales person is SOOOOOOOOOOOOOOOOOOO nice!!!!!!!!!!!!! The decision is perfectly rational because our colleagues are operating under social norms (this person would never lie to me and they don't lie. Just don't talk about fees) and the sales forces KNOW THIS and act accordingly as they are driving their expensive BMW and taking their kids to expensive private or exclusive public schools.

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Mark, I went to the prospectus you linked us to. I found your "example" references. There it is, in black and white. Am I correct in assuming that I would find this "example" on any prospectus of any fund I was considering? To be honest, I've never fully read a prospectus because the only thing I was really interested in (in the past) was the degree of risk.

 

Although all of my funds are currently with Vanguard directly or Pension2-TIAA-Cref, this makes me want to go read some of the prospectus' I've got in a drawer!

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