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mdoyne

Gwinnett County (Georgia)

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I don't see anything mentioned about Gwinnett County Public Schools on this website. It's the 14th largest district in the US. It's been named one of best employers in the US as well, so I assume the retirement plan options are probably pretty good. 

Here are the plan options under the 403b and 457b plans:

http://publish.gwinnett.k12.ga.us/gcps/wcm/connect/5cd490dc-7519-4e53-8e82-c31b65929aef/Investment+Options+10+31+2018.pdf?MOD=AJPERES

I wonder if someone could provide some feedback?

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2 hours ago, Bashdash said:

I see "self directed" on the bottom.  That is a good sign usually in this non transparent 403b world.  Others will come along and chime in with more info.

Thank for the response 🙂

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19 minutes ago, Bashdash said:

Maybe that will help avoid some wrap fees, advisor fees, asset under management fees, or other ridiculousness.

That's what I'm hoping!

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Frankly, I am not impressed. The fees should be listed right next to the fund name. Which funds are 403b and which are 457?Also, it seems to me if you want a diversified portfolio of your own making and  want  to utilize the one Vanguard fund you have, you will have a difficult time because no bond funds are available that  are are appropriate. A high yield bond fund is your only choice and high yield bonds act more like stocks so not a good choice as a diversifier. Also it seems you have mostly managed funds which means you can not create an all index fund portfolio and will pay more.

It is a poorly done brochure and you will need to look through each fund perspective to see the fees you might be paying . Is that the total brochure?

So, your best bet is really the only way I would go. Use the self directed option to pick funds outside your current choices. I would pick all index funds. A Total Stock, a Total International, and a Total Bond. A three fund portfolio is all you really need. Fidelity or Vanguard would be cheap.

BUT:

The T Rowe Price Target Funds might be O.K as your  second choice. I would want to know the expense ratio of the fund but it might be o.k to go that route as TROWE Price is a respectable company but a Vanguard Target Fund will probably cost you less in fees which you can get through the self-direct option 

Also I see the name VALIC so be careful that you don't use an advisor and stay away from any annuity like products they may try to hook you into.

WE can help you further if needed.

 

Tony

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2 hours ago, tony said:

Frankly, I am not impressed. The fees should be listed right next to the fund name. Which funds are 403b and which are 457?Also, it seems to me if you want a diversified portfolio of your own making and  want  to utilize the one Vanguard fund you have, you will have a difficult time because no bond funds are available that  are are appropriate. A high yield bond fund is your only choice and high yield bonds act more like stocks so not a good choice as a diversifier. Also it seems you have mostly managed funds which means you can not create an all index fund portfolio and will pay more.

It is a poorly done brochure and you will need to look through each fund perspective to see the fees you might be paying . Is that the total brochure?

So, your best bet is really the only way I would go. Use the self directed option to pick funds outside your current choices. I would pick all index funds. A Total Stock, a Total International, and a Total Bond. A three fund portfolio is all you really need. Fidelity or Vanguard would be cheap.

BUT:

The T Rowe Price Target Funds might be O.K as your  second choice. I would want to know the expense ratio of the fund but it might be o.k to go that route as TROWE Price is a respectable company but a Vanguard Target Fund will probably cost you less in fees which you can get through the self-direct option 

Also I see the name VALIC so be careful that you don't use an advisor and stay away from any annuity like products they may try to hook you into.

WE can help you further if needed.

 

Tony

Thank you very much for this thorough feedback, Tony. I probably should have posted this link as well - it's much more comprehensive with fee and performance info as well. http://publish.gwinnett.k12.ga.us/gcps/home/public/about/business-and-finance/retirement/content/home/plan/403b-457b-rsp

I believe the 457b and 403b options are the same. 

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O.K, that helps. Yea I must admit, you have some decent options. And with a 403b and a 457b you can really sock some serious money away. Not sure I have ever seen a 403b and 457b plan in duplicate. Usually they have different fund choices.

Your plan is good but is missing index fund options. Too many managed funds. Managed funds usually underperform index funds over time because of the higher fee burden.The Vanguard Index fund you do have has the lowest fees. Have you noticed that? If I didn't know what I know I would probably invest in the target funds by TRowePrice. But I must maintain my stubborness and say your plan is inadequate for the reasons I mentioned above.

Your self direct option would allow you to tap into index funds so overall your system has a good plan. Problem is do the employees know how to self direct?  Have they had an inservice explaining the plan they have?  Or are they left to the devices of a comissioned salesperson?

 

I'm really not criticizing this school plan. Its decent. But we here  like to see the lowest fees possible because higher fees hurt performance over time.  If these choices are not used as a switch and bait by Valic to get people into higher cost annuities than I really can't criticize the options but your 403b/457b needs better bond choices and more index funds

 

I hope I have helped.

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oops actually you do have a moderate bond choice in Pimco. I missed that. Still its a managed fund and it has disadvantages.

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This is great support, Tony. This summer the county is offering several sessions to help support the employees. I don't know what support would be provided for the self-directed funds. Yes, I did notice the Vanguard fund has the lowest fees - thank you for confirming. I believe the offerings have improved over time. 

Our VALIC reps have been very nice to work with, but I don't know how much to follow their guidance. I appreciate that you have taken the time to respond.

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Just keep in mind Valic reps work on commission and they are under no obligation to do what is in your best interest. Their pearly white smiles in  neat suits can be very convincing but  you must not trust them. You can listen but you must do your own research. Most are looking after themselves  and not YOU!!

I'm sorry to say that about people I don't even know and I am sure there are some good people working at Valic who are just trying to make a living. But my experiences has been that many  lie  and deceive just to get you to sign that dotted line.  

 

Encourage others to come here before they sign up for any plan.

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It is interesting that the county seems to have a single 403b and 457b vendor. On its own, that would be a good thing because it minimizes confusion. However, the single plan being offered is rather bad. If I were in your shoes (and I was at one point), I’d push to reform the plan.

The single Vanguard fund is actually great, but everything else ranges from slightly bad to awful.

I don’t know what your preferred asset allocation is, but personally I would strongly consider exclusively using the Vanguard fund and use an IRA or my spouse’s account to hold my international and my bond funds. I’d be willing to compromise on my ideal asset allocation if it meant rock bottom fees. 

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Ed

I agree with you but it's all a matter of perspective. Compared to annuities and 2 % -3% expense ratios it's a great plan  choice. Compared to a basic 3 fund index portfolio with rock bottom or no expense ratios through Vanguard or Fidelity, her plan sux.  I also think her 403b plan and 457b plan should be separate and distinct entities.

 

Tony

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8 minutes ago, mdoyne said:

Shouldn't the Schwab PCRA Self-directed fund allow for diversifying?

I only skimmed the 30 to 40 page PDFs. I didn’t see what the fees and options were in the self directed option. You’re right, that option must be explored. 

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