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MWTW

403b choices with match

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Hi! I'm so happy to find a place where teachers (and those that care about them) are talking about investing.  I am a teacher in a very small, rural district in Oregon.  My district offers a 403b match of $30 per month but I am told the only options for this are American Fidelity and Foresters.  I'm leaning towards using Foresters with the minimum needed to get the match since it is not an annuity and does not have the high surrender fees that American Fidelity does.   However, it looks like Foresters funds do have up front fees of around 5%.  Sigh.  So both seem like poor choices- yet I feel I should use this match opportunity.  Anyone have experience with these two and ideas of which one might be better if I have to use one or the other?  

Fortunately, we also have a 457 available which has low-ish fees  (the Oregon Savings Growth Plan), so I am mainly saving in that.  

I hope to start informing colleagues and working with the district, trying to get a better 403b option added.  I am particularly worried that the rep from one of the 403b companies is presented as "our retirement guy" in this district.  I seriously thought (for my first couple years teaching here!) that he was a district employee!  This was my impression from emails where the district helps him set up his advising appointments, that he is given the meeting room when he visits, and the way he was presented and introduced.  I'm concerned that my colleagues are being misled.  Most seem to invest there (and don't use the 457).  Thoughts on how to help open eyes to this?  

Thanks for any ideas or thoughts and I am grateful to find a place to talk and continue learning about all this!

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Ouch. Never make it about him. You know it is not a personal conflict but it will need to be conveyed accurately and for what it is - expensive. Perhaps look around in other local area districts where employees are familiar to use as a good example. Find out specific steps on how to add a low cost vendor, and determine the savings. Then, present your case using data. This guy sounds like he is “beloved” and no one would suspect the cost he comes with.

Good luck. You are doing a great service.

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Welcome MWTW. So glad you found us. Let us know how we can help you. If you are OK with Facebook (and I haven't always been) we have a "Teach and Retire Rich" Facebook Group. I am also hosting an "Introduction to the 403(b)" video conference on Saturday, August 17th. Space is limited to 20. We are close to releasing an education and advocacy PowerPoint that you can use with your colleagues. We will announce this through our BWISE ALERT and will post in the Advocacy section. Also, we would love to feature you in our Teacher Stories section 😀

Dan

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Sounds like the teachers are being taken advantage of and the district does not realize it. That is what has been going on in our school district and I am working on getting a better plan set up. It will take time. That $30 match may not be a good deal if you are paying high fees. I have a meeting with our superintendent soon and have been putting together information for him and other employees. I don't mind sharing it here and don't mind feedback or criticism: https://teachingrich.blogspot.com/p/home.html This info is subject to change as I do more research or find cheaper options. 

In the meantime you might consider setting up a Roth IRA. My wife and I both have one at Fidelity that we max out every year. You don't have to go through the district to set it up. You can do it in 5 minutes online. They have over 500 commission free ETF's. Vanguard is also a good choice for Roth IRA's. There are some advantages of a Roth IRA that 403B's don't offer. Ideally we would max out both a Roth IRA and 403B, but our 403B's are too expensive so I use a taxable brokerage account. We are working on getting the 403B options changed. Good luck.

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Chris - Thanks for joining. Good suggestion about starting a Roth IRA. As I mentioned above we will post a useable PowerPoint soon. - Dan

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