Megan White 0 Report post Posted April 23, 2019 Hi! I'm a 5th year teacher and just now getting a handle on the 403b lifestyle. After listening to the podcast, I'm so upset my district does not offer Vanguard. If you had to pick the "next best thing" which would you choose between VALIC, Metlife, Lincoln Investments, VOYA Financial, or AXA. My district endorses VALIC, but they all seem like salesmen to me and seem to not have my best interest in mind. Thanks so much in advance! Quote Share this post Link to post Share on other sites
aef5080 0 Report post Posted April 23, 2019 Email your payroll specialist and ask if Vanguard can be put on the list. I asked my district if they would add Vanguard as a vendor for our 403b and 2-3 months later it happened! I couldn’t believe it. Quote Share this post Link to post Share on other sites
MNGopher 0 Report post Posted April 23, 2019 2 hours ago, Megan White said: Hi! I'm a 5th year teacher and just now getting a handle on the 403b lifestyle. After listening to the podcast, I'm so upset my district does not offer Vanguard. If you had to pick the "next best thing" which would you choose between VALIC, Metlife, Lincoln Investments, VOYA Financial, or AXA. My district endorses VALIC, but they all seem like salesmen to me and seem to not have my best interest in mind. Thanks so much in advance! I strongly do not endorse VALIC. I had to deal with them for years before getting out. However it is worth checking out what funds they have offered for your district's plan. It could be different in your area. Quote Share this post Link to post Share on other sites
krow36 0 Report post Posted April 24, 2019 5 hours ago, Megan White said: Hi! I'm a 5th year teacher and just now getting a handle on the 403b lifestyle. After listening to the podcast, I'm so upset my district does not offer Vanguard. If you had to pick the "next best thing" which would you choose between VALIC, Metlife, Lincoln Investments, VOYA Financial, or AXA. My district endorses VALIC, but they all seem like salesmen to me and seem to not have my best interest in mind. Thanks so much in advance! None of those 5 vendors are a slam dunk like Vanguard, Fidelity and Security Benefit (only their NEA Direct Invest) would be. However, if you are teaching in NJ, Lincoln Investment has an excellent low-cost 403b and 457 plan that you could use. It's also available in a few districts in NY and near Chicago. VALIC, and VOYA Financial may offer mutual fund based 403b(7) plans in addition to their very expensive annuity based 403b plans. You would have to talk to each of them and study their admin fees as well as the expense ratios of their mutual funds. Please do not let them sign you up to an annuity 403b!! Lincoln Investment does offer a mutual fund based 403b(7) plan that they call their Retirement Solutions Premier. It has a Management/Wrap fee of 1.25% but does offer many low-cost Vanguard Investor class funds. So this is far from ideal, and getting Vanguard or Fidelity added to the vendor list would be the way to go and worth the effort! Many states have a very low-cost state-run 457 plan that is available to school district employees. Teachers can contribute to both a 403b and a 457 plan (a maximum of 19k to each). What state are you teaching in? Does your district have a 457 vendor list? It’s possible that a state 457 plan would be all you need until later in your career? Quote Share this post Link to post Share on other sites
EdLaFave 0 Report post Posted April 24, 2019 I second everything krow said. I also want to encourage you to reform your district’s 403b/457b program. I was able to get Fidelity and Vanguard added to my district and I hope to eventually get rid of the predatory vendors. I’m happy to help you figure out how to do this if you’re so inclined. Quote Share this post Link to post Share on other sites
sschullo 0 Report post Posted April 24, 2019 Hi Megan, You got excellent feedback. BTW, welcome to the 403(b) world with K12 school districts. Quote Share this post Link to post Share on other sites
Admin 0 Report post Posted April 24, 2019 Hi Megan, Welcome to the site and I apologize for my tardiness in getting you approved to post. Do you have a Roth IRA? If not, you could start with that at say Vanguard and then work to get better 403(b) choices. Here's a story comparing the 403(b) and the Roth IRA: https://403bwise.com/k12/content/23 Also, what state are you in? - Dan Quote Share this post Link to post Share on other sites
Mewhite23 0 Report post Posted April 24, 2019 Thank you all so much! I have some investigating to do. Dan-no problem on the delay. I can’t explain how much your podcast has helped me and I’ve been passing it along to fellow teachers who love it just as much, so thank you! I am teaching in Illinois (Cicero to be exact). I do not have a Roth IRA, but definitely interested in looking into that option. Quote Share this post Link to post Share on other sites
krow36 0 Report post Posted April 24, 2019 5 hours ago, Mewhite23 said: Thank you all so much! I have some investigating to do. Dan-no problem on the delay. I can’t explain how much your podcast has helped me and I’ve been passing it along to fellow teachers who love it just as much, so thank you! I am teaching in Illinois (Cicero to be exact). I do not have a Roth IRA, but definitely interested in looking into that option. You may have lucked out with the Lincoln Investment Participant Direct Platform! There is at least one Chicago area district that is allowed to use it, but you will have to call to see if your district is allowed. The annual fee is either $35 or $65--it seems to vary. You should call a Lincoln Investment regional office to ask for permission. They are the only source of the application form, which states the rules for the plan. They will email you a link to the application form if they allow your district to use it. A local LI rep can't give you permission but would be able to give you the number to call. You can read about the plan in this thread from last year. https://board.403bwise.com/topic/6780-lincoln-investments-participant-direct/ There is nothing on the internet about this option, except on this forum and on the bogglehead.com forum. Lincoln Investment obviously wants to control its use. I have a link to an out of date form and will send it to you if you send me your email address in a Private Message. Quote Share this post Link to post Share on other sites
krow36 0 Report post Posted April 24, 2019 It looks like IL will get a state-run 457 plan in the near future, according to this newspaper article. You will probably learn about its details before we do. Please send us a link to any article on it you come across. Teachers who are part of either the Tier 1 or the Tier 2 pension plans can enroll, although Martwick acknowledged it will most appeal to teachers in the Tier 2 plan that has far less generous benefits. But it’s going to be a while before the new program is available. TRS spokesman Dave Urbanek said it won’t be available before June 30, 2019, the end of the current fiscal year. https://www.sj-r.com/news/20180915/teachers-will-get-new-retirement-savings-plan-eventually The forum discussion of this article is here: Quote Share this post Link to post Share on other sites
krow36 0 Report post Posted April 25, 2019 At the bottom of page 1 of original thread by A440 on the LI PCP, see the posts by HAWK23 from “the Chicago area”. https://www.bogleheads.org/forum/viewtopic.php?f=1&t=175295 Good Luck! Quote Share this post Link to post Share on other sites
MoeMoney 0 Report post Posted April 29, 2019 Welcome Megan. You have excellent answers here. I second what Ed said - keep up your advocating by sharing with your colleagues and asking more of your district. If you strike out with the above suggestions, consider asking for Aspire to be added. You will pay an annual fee of $40 plus a 0.15 expense ratio on top of your selected fund fees but you can dramatically lower your overall costs given your other alternatives. Let us know how you do and welcome to your 403b lifestyle! Quote Share this post Link to post Share on other sites
krow36 0 Report post Posted April 29, 2019 Unfortunately I think filing an extension on your 2018 return will not allow you contribute to an IRA for 2018 after April 2019. Quote Your tax return filing deadline (not including extensions). For example, you can make 2018 IRA contributions until April 15, 2019. https://www.irs.gov/retirement-plans/traditional-and-roth-iras And: Quote Contribution Deadline Tax-filing extensions do not apply to your IRA contributions, except for SEP-IRA contributions. This means that your contributions must be deposited by your tax filing due date, which is usually April 15. https://www.investopedia.com/articles/retirement/05/021505.asp I was also under the impression that an extension allowed an IRA contribution so a relative I help missed out on a contribution for 2018. A contribution to their taxable account for retirement was accepted as next best. Quote Share this post Link to post Share on other sites
MoeMoney 0 Report post Posted April 29, 2019 krow, You are right. However, since contributing to a Roth IRA in 2018 before knowing your MAGI, and then filing taxes (on time or not) you have 6 months from April 15 2019 to "correct" the contribution without incurring a 10%withdrawal penalty. You will, however, have to pay a 6% penalty on any gains earned. (Was this an answer on another thread?) Quote Share this post Link to post Share on other sites
krow36 0 Report post Posted April 30, 2019 5 hours ago, MoeMoney said: krow, You are right. However, since contributing to a Roth IRA in 2018 before knowing your MAGI, and then filing taxes (on time or not) you have 6 months from April 15 2019 to "correct" the contribution without incurring a 10%withdrawal penalty. You will, however, have to pay a 6% penalty on any gains earned. (Was this an answer on another thread?) Yes, another thread!!? I'm loosing it! My apologies. I'm glad to learn about avoiding the 10% withdrawal penalty for 6 months after April 15. So the 10% penalty is because you are under 59 1/2? And the 6% is the penalty for withdrawing gains from a non-qualified Roth IRA, meaning your first Roth contribution is <5 yrs old. Is that right? Quote Share this post Link to post Share on other sites