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Tony Starks

University System of Georgia 403b - new options - Can I move existing money from Valic ---> TIAA?

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Hi, I am new to the community and have some questions.  I am currently employed by the University System of Georgia and have been here for 17 years.  I stated contributing to a 403b in 2012, and have been contributing every month.  Up until this point, Valic/AIG was our only option for the 403b and 457 plans at my college.  Previously the choices for plan vendors varied depending on the college/university you were employed with. 

Recently the University System of Georgia decided to overhaul the 403b and 457 options, going to three providers (Valic/AIG, TIAA and Fidelity) that members of all institutions could use for their plans.  Here is the website that lists the info on the plan changes:  https://www.usg.edu/hr/benefits/retirement  

All the plans offer the same fund options now, however the fees charged vary depending on the provider you choose.  I have already stopped sending contributions to Valic/AIG, and have future contributions going to TIAA.  I have opted for Vanguard VIIIX, which has the following total fees (including fund expense + plan administration fees) and VIIIX fees vary as follows:

Fidelity 0.1204%

TIAA 0.0754%

Valic/AIG 0.1504%

Obviously TIAA has the lowest fees for this same VIIIX fund of the three providers.  The question that I am looking for some advice on is:  now that I have the option of using TIAA at a lower expense, can I move my existing money from Valic/AIG ---> TIAA?  And will there be any surrender fees or other charges that I am going to be charged by Valic to rollover these funds from Valic ---> TIAA?  If anybody has info. or any experience moving money in this type of situation, you assistance would be great appreciated!

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3 hours ago, Tony Starks said:

The question that I am looking for some advice on is:  now that I have the option of using TIAA at a lower expense, can I move my existing money from Valic/AIG ---> TIAA?  And will there be any surrender fees or other charges that I am going to be charged by Valic to rollover these funds from Valic ---> TIAA? 

Tony

Im not exactly familiar with the college scene 403b But my guess is since both Valic/AIG and TIAA are both being offered you should be able to do a transfer. But there may very well be a surrender charge depending on the product you are in.Is it an annuity? Check your statement or online account. See if it indicates a surrender fee. If not call Valic and ask them for it. If your investments with Valic are outside an insurance product there might not be a surrender charge.

To transfer you will need to contact TIAA and ask them for the proper paperwork to initiate the transfer. There may be paperwork needed on both sides to be filled out. You will have to ask both companies what they require for a transfer. i would lean on TIAA to do as much of the work as they can to get the transfer done. Since they are now getting the money they will be much more motivated to get the transfer done than Valic will.

The big charge you may be looking at is the surrender fee which I would go ahead and pay and move on from Valic/AIG. You'll recoup that money eventually being in a lower fee product. There might be other small inconsequential fees for closing the account but the biggie would be a surrender charge.

I would encourage you to stay on top of both companies to make sure your transfer is front and center and not end up on a back burner. That may require calling them every few weeks on the progress of the transfer if you don't see any movement. There is always a backlog, and the squeaky wheel gets the grease.

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The state of Georgia is paying 4x the fees that individual school districts pay with Fidelity. Talk about negotiating power!

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