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Rubbadubbss

Can i change the 403b/457 company that my job wants me to use?

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12 minutes ago, tony said:

I doubt it too but sometimes they don't know and might not give the info clearly or accurately. I know in the past when I have dealt with these folks on every level I was given wrong info. I would definitely want to see it stated in writing or online in writing.  That's just me. 

Yes Tony, those of us from the K-12 403b world have good reason to be cautious and skeptical. However Rubbadubbss is dealing with a plan where the employer has assumed some fiduciary responsibility. Of course one should always know the fees one is paying. In this case, I don't think worrying about hidden fees is justified. I think Rubbadubbss will find that there is a reasonable admin fee, either a fixed dollar amount per year, or a small percent per year added the the account balance. 

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2 hours ago, Rubbadubbss said:

okay, thanks everyone! I feel better.

@MNGopher-- what are wraparound fees?  What's the best way to make sure the benefits rep and Valic rep honestly answers about those?

Just that insurance companies like Valic tend to hide fees and expenses that you wouldn't get when investing directly with a mutual fund company like Vanguard.  Perhaps they are more transparent now than when I dealt with them, and your plan could be much different than mine.  I just remember that the Vanguard funds offered to me through Valic were about .70-1.0% higher expense ratios than going directly through Vanguard.  Sometimes they will tie in death benefits or other insurance nonsense with their investment products.

 

 

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MNGopher, by comparing your VALIC annuity in a K-12 403b with Rubbadubbss' 403b plan where VALIC is the record keeper and administrator, you are comparing apples and oranges. Maybe carrots and peaches? It's common for the big insurance companies to have two very different roles. In the K-12 403b market, they sell  high-cost generic annuities and mutual fund plans.

However as record keepers and administrators for large state and university plans and non-profit plans, they use other vendors' mutual funds. The mutual funds that are selected and the ER and admin fees charged are bargained by the employer and VALIC. The employer assumes some fiduciary responsibility towards their employees in these plans, unlike in the K-12 403b world. I think Rubbadubbss was also unaware of the different roles that VALIC can have also. 

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MNGopher

 

Thanks for posting. Your contributions are valued. Keep posting.  Everyone's opinions matter here. I got the point you were trying to make. Krow's posts are starting to sound rather condescending lately.

 

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10 minutes ago, krow36 said:

MNGopher, by comparing your VALIC annuity in a K-12 403b with Rubbadubbss' 403b plan where VALIC is the record keeper and administrator, you are comparing apples and oranges. Maybe carrots and peaches? It's common for the big insurance companies to have two very different roles. In the K-12 403b market, they sell  high-cost generic annuities and mutual fund plans.

However as record keepers and administrators for large state and university plans and non-profit plans, they use other vendors' mutual funds. The mutual funds that are selected and the ER and admin fees charged are bargained by the employer and VALIC. The employer assumes some fiduciary responsibility towards their employees in these plans, unlike in the K-12 403b world. I think Rubbadubbss was also unaware of the different roles that VALIC can have also. 

Yes, of course they are different.  As you yourself noted though, he didn't specify that he was with a medical organization and not K-12 in his initial post to which I was responding.  I don't know anything about medical employee plans, but I would assume it is still wise to investigate all fees.

 

 

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1 hour ago, tony said:

MNGopher

 

Thanks for posting. Your contributions are valued. Keep posting.  Everyone's opinions matter here. I got the point you were trying to make. Krow's posts are starting to sound rather condescending lately.

 

My apologies to MNGopher and other readers. I guess I overdid it, trying to make a point about the evil empire of insurance companies. 

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I just wanted to tell the OP that I agree with Krow’s analysis.

...also, for what it’s worth, I haven’t taken Krow’s posts to be negative. To me at least, they’ve come across “matter of fact”. I think we’re all just trying to get to the truth and prevent people from getting ripped off and text is a tough medium to communicate through. 

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1 hour ago, krow36 said:

My apologies to MNGopher and other readers. I guess I overdid it, trying to make a point about the evil empire of insurance companies. 

Not a problem.  I get suspicious of any investing product that is offered by an insurance company, especially one that has ripped me off in the past.  In this case it appears the OP has good options in his plan.

 

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