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krow36

New Jersey 403(B) State-Wide Choices?

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In Jan 2013, Joel L Frank posted the following in the 457b forum.

"On or about July 1, 2013 the list of participating employers [in the NJ ACTS 403b plan] will grow by about 600 when the State's school districts will be added. This is great news for the vast majority of New Jersey public educators---the public school teachers of New Jersey."
http://board.403bwise.com/index.php?showtopic=5585&do=findComment&comment=30725
The current ACTS website indicates that this 403b program is not an option for K-12 teachers.
"Employees of county colleges, state universities and colleges, the Commission on Higher Education, the Department of Education, and the Office of Student Assistance are eligible to participate in the ACTS Program."
What's the story here? The TIAA/CREF option would have been a big improvement over the usual expensive insurance 403b providers available to NJ teachers wouldn’t it?
The one NJ state 403b program that seems to be open to K-12 teachers is the SACT. On a Bogglehead thread, NJ teacher mikew041 asked for help finding a 403b that was worth using: https://www.bogleheads.org/forum/viewtopic.php?f=1&t=179734
I compared the SACT annual performance using their unit values with the performance of Vanguard’s Life Strategy Moderate Growth (60/40).
SACT.------SACT ——LSMG
2012——— 8.27%—— 11.76%
2011——— 1.71——— 0.26
2010——— 13.01—— 13.31
2009——— 14.86—— 20.33
2008***** -34.13*** -26.50
2007——— 0.33—— 7.36
2006——— 11.85—— 13.31
2005——— 4.35—— 5.69
2004——— 8.21—— 10.57
2003——— 23.56—— 22.40
2002******** -27.47** -10.32
2001******** -12.04** -4.48
In 10 out of 12 years, SACT significantly underperformed LSMG. I couldn’t find any discussion of SACT’s expenses but I’m guessing there’s an expense drag of more than 1%. Not a very impressive showing of the NJ Dept. of Treasury, is it?

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Hi Krow36,

"Not a very impressive showing of the NJ Dept. of Treasury, is it?"

 

I agree with your analysis, and I am not defending SACT because I know nothing about it, but compared to a typical 403b TSA annuity sold to millions of public school educators throughout the country would make SACT an improvement (of course we have to know the costs).

Sure, we all want Vanguard, but it's not available for most public k-12 educators.

 

Steve

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