PLEASE HELP!! Young teacher with a 403b

[Paige 0]

Hi everyone! My name is Paige. I'm a 25 (almost 26 in a week) year old teacher in Massachusetts. I am about to be entering my 4th year of teaching. I signed up for a 403b, and life and disability insurance all through mass mutual. I am ashamed to admit that it was all so confusing to me, but I knew it was something I needed. I signed up for it all going in kind of blind. Wanting to take more control of my finances, I found this podcast/website. I'm still very confused but have a feeling I do not have a good product. I'm thinking I'm going to need to sit down with a fee only financial advisor... but could someone please give me some insight? I'm on my online portal and it's still all so confusing!! 

Here are some screen ss that I took from my dashboard. I'm having a hard time finding the fees..... but it looks like my surrender is 9 years, which does not sound good! I found this through Mass Mutual, but don't fully understand. https://www.massmutual.com/efiles/ann/pdfs/an6102.pdf

Any guide in the right direction, any insight, and any tips on what I should do next would be greatly appreciated. 

I also found this on my district's website that mentions and recommends the state’s Deferred Compensation or 457 Program.

Also, any thoughts on whether or not I should keep the "whole life legacy" insurance and the disability insurance. Thank you everyone!

[tony 0]

Paige

I am so glad you found this website and discussion board. I wish more teachers would .

Without getting into too much detail at this time could you find and list all other vendor choices( companies) your school system might offer in a 403b or 457b account. Sometimes they are posted on your district homepage or you may have to request the list from the person who oversees these accounts within your school or district.

I would say at first glance we need to get you out of the contract you are in. Once we have your other choices available to you we can advise you better.

Please don't be hard on yourself for not understanding investments. Its a common problem and all of us have made mistakes and have fallen prey to these fake advisors. 

I don't think you need to see a fee only advisor at your age. We here can set you right and I would save the fee only advisor when you are older and your finances are a bit more advanced and complicated. Right now your bst advice would be to save all you can in a low cost 403b plan.

Hope to hear from you, we are anxious to help

Tony

[tony 0]

2 hours ago, Paige said:

Also, any thoughts on whether or not I should keep the "whole life legacy" insurance and the disability insurance. Thank you everyone!

 

Life insurance often isn't needed for a single person with no children. Some may say, "Buy it while you're young and healthy." The reality is that, if you don't need coverage, the money toward a life insurance premium could be better utilized by contributing to retirement savings or building an emergency fund.  I know an ex teacher who went to work for an insurance company and sold a bunch of  single teachers these type policies attached to an annuity. Most of these folks ended up dumping those accounts one they got smarter.

Disability insurance is often offered by  some school districts for free or reduced cost or through your union NEA dues. Mine was. Check to make sure if you don't already have it included as part of your retirement benefits package or through your NEA membership if you have a union membership.

I don't know your situation so in general if you decide to buy life insurance i would go with term insurance (Term life insurance is the easiest to understand and has the lowest prices)and I would buy it independently of any investment annuity and not from an annuity salesman LOL!!. Disability insurance if you decide you must have it is also purchased separately and not as an add on product.

Tony

 

with a new school year  insurance salespeople are in full force  to sell teachers products that will give them fat commissions. Walk away.

[tony 0]

2 hours ago, Paige said:

I'm having a hard time finding the fees...

Don't blame yourself. I think its often intentional because the fees are usually high.

[MNGopher 0]

58 minutes ago, tony said:

Don't blame yourself. I think its often intentional because the fees are usually high.

Yes, they are very good at hiding fees.  Expense ratio (er), expressed as a percentage, is the main way to compare fees assessed on investments, but this is not the only fee with annuities. As Tony mentioned, if you list the other choices from your district's approved vendor list, then the people here can usually quickly tell you what the best option is.

 

[tony 0]

MNgopher

Lets hope she will return to get the helped she asked for. As is often the case with some posters ,they ask for help but never return. Sometimes they end up seeking that help from the very people that are over charging them  and ripping them off in the first place.

[Admin 0]

Welcome, Paige. Do not be too hard on yourself. You didn't know what you didn't know. We are here to help. You have already received some good advice. I will echo Tony's comments and encourage you to see what other 403(b) choices you have. - Dan 

[EdLaFave 0]

1. Definitely find and post every 403b and 457b vendor your district has approved. You may want to take a look at my page documenting the best vendors available throughout Florida (a good proxy for the nation).

2. You do not need to pay anybody for advice. The industry makes it complicated, we can cut through the nonsense and make it simple for you. You may want to read the Investing 101 page I’ve written.

3. Don’t feel shame, you may want to read a blog post I wrote that explains how you fell into something tailor made to trap you.

4. I already know everything I need to know about your current plan...I would get out as soon as I identified my best alternative. 

[raido_me 0]

Welcome Paige! I too am a teacher in Massachusetts. I came here a couple of years ago to educate myself on the murky world of 403(b)s. The forum definitely helps. I recommend using it to your advantage. I've come back because I recently took a new position and could use a refresher. I would definitely call the HR office and figure what your options are for plans. If your options aren't that great, I would recommend the 457 state plan. When I last researched it, I remember it offering some decent mutual funds. The only reason I didn't go with it was because I had Fidelity as an option. Best of Luck! Keep us updated. We all learn from this experience. 

[tony 0]

43 minutes ago, raido_me said:

I would recommend the 457 state plan.

Paige

See if your school district has this available. If not ask them to add it. It's easy to do if you can motivate someone to do the minimal paperwork to add it.Thanks for your input Raido_me. I hope Paige returns to our forum.

 

 

 

 

 

 

 

 

 

 

 

 

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[raido_me 0]

32 minutes ago, tony said:

Thanks for your input Raido_me. I hope Paige returns to our forum.

 

 

 

Tony, 2 years ago you really helped me. I took a year off from teaching since then and am now getting back in the game. I was nervous about looking up my vendor options for my new job as my last place had Fidelity. I was hoping I could stick with them to keep everything the same. The new job doesn't have Fidelity but Vanguard is an option so I'm psyched about that. 

 

 

 

 

 

 

 

 

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[Paige 0]

Hi everyone! Thank you all so much for already being so willing to help. I have had a busy day traveling but am back on the forum and am so relieved to see so many caring people reaching out! Thank you. I don’t see a list of vendors but my district does have this site which explains different options. They even strongly recommend not to buy from insurance companies.. if only I had read this before! http://chicopeeeducators.org/planning-for-retirement/

[Paige 0]

13 hours ago, EdLaFave said:

1. Definitely find and post every 403b and 457b vendor your district has approved. You may want to take a look at my page documenting the best vendors available throughout Florida (a good proxy for the nation).

2. You do not need to pay anybody for advice. The industry makes it complicated, we can cut through the nonsense and make it simple for you. You may want to read the Investing 101 page I’ve written.

3. Don’t feel shame, you may want to read a blog post I wrote that explains how you fell into something tailor made to trap you.

4. I already know everything I need to know about your current plan...I would get out as soon as I identified my best alternative. 

Thank you for the advice. I just read the page on investing 101. That’s a great place for me to start I have a lot to learn.

[MNGopher 0]

That's great that your district puts a warning about annuities and insurance salesmen right on their website!  I bet if you call the HR/benefits office at your school they could tell you which companies are allowed vendors for 403Bs.  The fact that they warn you about annuities indicates that you probably have some low cost mutual fund custodians available to you.

 

[Paige 0]

I’m going to call them Monday and see!