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MoeMoney

Using NEW techniques to enlighten teachers about the 403b plight

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I've been contemplating the best way to expand the reach of the message that this wonderful website and forum extoll to the masses of teachers who stand to benefit from such publicity. The latest articles in the media from Nils, Tara and several others are motivational and surely helpful. 

Steve and I witnessed, and continue to witness, how building a community has rallied masses of like-minded people together to inform and support each other while taking action to make changes. We want this for the 403b plight. (Steve, my apologies for including you without your permission - correct me if I'm wrong.)  

 I don't believe it's the message that is keeping it under the radar, nor the lack of interest. I want to create a media buzz and my thoughts are using all available resources to broadcast podcasts, create a facebook page, and then build a facebook group. While my thoughts on facebook have been mostly about avoidance, I recognize the value of it. Right next to facebook are instagram, linkedin, and of course Twitter. 

Realizing that the target audience is new-to-teaching people, and therefore mostly younger folks, I believe these are among the best platforms because they are using them.

What are the thoughts of this community on building my idea? I will build it, but will they come???

Listening to Dan and Scott's recent podcast, it drove home the message Scott so eloquently voiced "it has to come from a teacher". 

We are teachers. Thoughts?

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I encourage you to try to build a group of teachers to push for reform. But this is what my experience has taught me...

The vast majority of teachers will not take a single step to help themselves much less to reform the system to help everybody else. They were happy to provide encouragement (presumably genuine), but not action.

Almost everybody that I was able to help found me through my website. However, none of the folks nearby were willing to go beyond fixing their individual situation.

The real solution is to get the government to pass legislation that replaces the current 403b/457b with the TSP (or TSP-like system) and to auto-enroll teachers into a target date fund. Otherwise you have to fix the issue at every single district.

It would be great if you could get teachers’ unions to back this effort, but my experience there has been pretty dismal.

On the other side of the coin, perhaps if I were a teacher and therefore able to pitch more teachers then I would have found more people willing to help.

Also, I don’t think you need many people to trigger reform. I got Vanguard and Fidelity added to OCPS (FL) all by myself.

However, my prediction is that this problem will continue until one of two things happens:

1) The people being exploíted begin to care about their own exploítation...maybe you can help with that.

2) A group of politicians decide it is politically beneficial to be seen as supporting teachers and they reform the system with the stroke of a pen.

...as things stand right now teachers are happy to be a part of this system. 

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I do think you can tell a comeplling story though...

Teachers (almost everybody likes them) are paid so litttle to education our children (our future), they have to buy supplies for the kids, they have to take their work home with them each night...and to thank them for their service we’re letting Wall Street types stroll into the schools and sign teachers up for retirement plans that rob them of up to 100% of real returns. So once the teachers hit retirement age they have little to show for it.

...I think that is a sympathetic story.

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9 hours ago, EdLaFave said:

I do think you can tell a comeplling story though...

Teachers (almost everybody likes them) are paid so litttle to education our children (our future), they have to buy supplies for the kids, they have to take their work home with them each night...and to thank them for their service we’re letting Wall Street types stroll into the schools and sign teachers up for retirement plans that rob them of up to 100% of real returns. So once the teachers hit retirement age they have little to show for it.

...I think that is a sympathetic story.

These stories have been reported over and over again for the last 24 years. We need a different approach. I like your political approach but the insurance industry is very powerful. I have seen them in action first hand in Sacramento when we tried to make changes. 

Newspaper and Online 403(b) Reports (1994-2016)

1.     Where to invest a 403b: almost anywhere by Melynda Dovel Wilcox, Kiplinger’s Personal Finance, Feb. 1, 1994. (Note: This article discussed only transferring from an annuity or high fee vendor into a low-cost mutual fund).

 2.     Fighting for 403b funds: With Annuities, you’re stuck with extra fees by Kevin McCormally, Kiplinger’s September1997 (Note: I learned about this great article after Kathy Kristof’s article).

 3.     Protect Yourself from American’s Flawed Pension Plans. By Andrea Rock, December 1, 1997, MONEY Magazine. 

 4.     The Fourth R: It’s Retirement, and for many teachers the arithmetic is narrow investment choices is unsatisfactory. If you are persistent you may be able to get your employer to broaden your choices. Kathy Kristof, Los Angeles Times, January 18, 1998. 

 5.     For Teachers, Object Lessons From the 401(k) by Richard A. Oppel Jr. New York Times, June 13, 1999.

6.     Public sector retirement savings plans often are accompanied by hefty fees that reduce returns by Helen Huntley. St. Petersburg Times Online Business, September 26, 1999.  

7.     1st Step in Teacher’s Lesson Plan: Crash Course in Investing by Suzy Hagstrom. Los Angeles Times Makeover special, December 21st, 1999.

8.     The Fleecing of 403b participants by CBSMarketWatch.com May 30, 2000.

 9.     Feds issue annuity warning by Marcy Gordon, Associated Press, published in the Daily News, June 6, 2000.

10. Special Report: Shark Attack! Investors in 403b plans, beware: You are especially vulnerable to predators by Don Kuehn, American Teacher. American Federation of Teachers (AFT) trade magazine, June 2000. 

11. Insurance Agents Weigh in on Column Taking Industry’s Bad Apples to Task by Liz Pulliam Weston, Sunday, June 18, 2000 Los Angeles Times. Ms. Weston’s response to a complaining insurance agent was brilliant.

 12. Retirement plans come in various flavors—403bs can leave a bad taste by Paul J. Lim. US News and World Report (July 10, 2000).

 13. Retirement Savings Plan Costs Teachers, Lawsuit say by Mary Doclar and Mike Lee. Fort Worth Star-Telegram, Sunday, September 17, 2000.

 14.  Savings Shock by Michele M. Capots. Education Week, Vol. 12, Issue 7, Page 9, April 2001.  

15. Changes to 403b plans help teachers save by Sandra Block. Your Money, January, 2002 USA Today.

 16. Teachers' 403b plan nonvirtues 'extolled', San Diego Union, 2004 by Lynn O'Shaughnessy.  

 17. Costly Lesson: Some of the biggest names in insurance peddle lousy retirement plans with high fees and low returns. One and a half million teachers blithely signed up for these dogs--often with their unions' blessing. Forbes Magazine by Neil Weinberg, 2005.

 18. Teachers get harsh lesson on investing, Saving for retirement harder with 403b law, San Diego Union, by David Washburn (2005).

 19. As Teachers Sock Money Into 403bs, Few Defenses Exist, The WSJ, Aug. 25, 2005 by Tom Lauricella.

 20. Teachers investment plans flunk, 403b plans could hardly be worse: fees are outrageous, there’s no match and there’s no oversight, MSN Money, 2005, by Timothy Middleton.

 21. Fleecing 403b plan participants, W. Scott Simon. This is an excellent eight-part series of articles tearing the 403b system apart, from total lack of fiduciary responsibility, high costs and the insanity of nobody in the educational establishment looking after the teachers' best interest. Mr. Simon is a Morningstar Advisor contributor.

Fleecing 403b Plan Participants                            April 5, 2007

Fleecing 403b Plan Participants (Part 2)               May 3, 2007

Fleecing 403b Plan Participants (Part 3)               June 7, 2007

Fleecing 403b Plan Participants (Part 4)               July 5, 2007

Fleecing 403b Plan Participants (Part 5)               August2, 2007

Fleecing 403b Plan Participants (Part 6)               October 4, 2007

Fleecing 403b Plan Participants (Part 7)               November 11, 2007

Fleecing 403b Plan Participants (Part 😎               June 5, 2008

 22. Prepare for Changes in 403b Plans, Wall Street Journal, MarketWatch.com, 2007.

 23. Fees take huge toll on 403b  plans, Bankrate.com, by Leslie Hggin Geary, 2007.

24. How to avoid 403b pitfalls, Bankrate.com, by Leslie Haggin Geary, 2007

25. California teachers' supplemental pension plan is flawed, study finds. Los Angeles      Times, by Walter Hamilton, March 2, 2011.

26. Teachers' 403b Plans See Big Changes, Wall Street Journal, January 4, 2012.

27. Law limits L.A. school district's efforts to simplify 403b plan, Pensions and Investments. By Robert Steyer, July 9, 2012

28. New York Times. Series of five articles on Public k-12 403(b) plans. First article published October 21, 2016 by Tara Siegal

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Steve, have you tried to access the Simon articles recently? Morningstar seems to have dropped them. Too bad, I always found them interesting, especially those on the K-12 403b problem. 

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Ed, I don't doubt that those who find you want only to fix their own problem. Most teachers who come here do the same. How is it that they found your website in the first place? What kind of marketing or media do you use for it? Can you share your website again?

The truth is, teachers have to first feel like they are being ed and care enough. From what I see, they don't right now. Why is that? 

If one teacher, then two, then three, talk about the overpriced salesmen, maybe it'll start a trend of correcting the wrong within the teaching community. These questions are obviously not meant to be answered and we've beaten that topic to death, I know. It's getting front and center in the online teacher's world that I'm thinking about. 

Is it plausible to join teacher forums and social media sites, and post comments there? I think so. I generally do not hang out on such sites. Yet. 

Steve, thanks for the reminder of all would-be wake up calls to the comatose.

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3 hours ago, MoeMoney said:

How is it that they found your website in the first place? What kind of marketing or media do you use for it? Can you share your website again?

https://educatorsfightingforfairness.wordpress.com/

I don’t do much to advertise. I rarely post on Facebook and Twitter. My site is indexed by the search engines. Almost all of my traffic comes from links I post on Bogleheads and here.

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That's a generous community service you're providing. Thanks for sharing the link. We are 403b Ombudsmen! 

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Moe,

In my own experience, it has been easy to make teachers aware of the high fees they’re being charged by insurance companies and other vendors but, they have had a tendency to shy away once they realize the low cost option involves investing on their own.  I’m referring to self direct options here.  This is assuming that a company like Vanguard or Fidelity is not available in the 403b vendor choices.

How could you go about helping teachers once they’re ready to leave the high priced insurance company?  

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On 11/18/2018 at 1:57 PM, krow36 said:

Steve, have you tried to access the Simon articles recently? Morningstar seems to have dropped them. Too bad, I always found them interesting, especially those on the K-12 403b problem. 

 

H i krow,

No, not recently, but you are right, his articles have all disappeared from M*. Sad. 

But you can sign up for his recent articles. Here is the latest one from him (Yes I know the link doesn't work, but I have notified him of this): 

 In this month’s column, I revisit target date retirement income funds.

 Some (back to July 2014 anyway) of my Morningstar columns (now 167 of them written since 2003) can be accessed at the Morningstar website:

 http://www.morningstar.com/articles/author/2193-w--scott-simon.aspx

 Please let me know if you wish to be removed from my emailing list.

 Best regards,

Scott

W. Scott Simon, J.D., CFP®, AIFA®

Prudent Investor Advisors, LLC

wssimon@prudentllc.com

www.prudentllc.com

 

 

 

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