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msucurt

Please help with 403b / Roth IRA decisions

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Well, i finally think I got the "plan number" and filled that in and sent to my school's HR dept. 

That's great that you got the plan number. Did you get it from the TPA?

I guess you also sent the Salary Reduction Agreement to Security Benefit as required? Have you asked for the district's own SRA from the TPA? That's the one that will be required by the school/TPA.

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On 11/2/2020 at 9:33 PM, krow36 said:

That's great that you got the plan number. Did you get it from the TPA?

yes I did.

I guess you also sent the Salary Reduction Agreement to Security Benefit as required? Have you asked for the district's own SRA from the TPA? That's the one that will be required by the school/TPA.

Says in STEP #2.....Next, you will need to print the Salary Reduction Agreement (PDF) and submit it to your school district's business office.

Should I send it to Security Benefit as well?

My HR said the SRA off their website is good enough. I sent it to HR and she replied "thanks". I am assuming I am good with that.

thanks!

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Was there an indication that the TPA used the same plan # for all the Security Benefit options? Or did NEA Direct Invest have its own plan #? Getting the plan # has been an annoying snag for many folks who were the first in their district to choose NEA Direct Invest.

I think that Security Benefit's Salary Reduction Agreement (which includes the TPA's plan #, is only of use to Security Benefit if the district/TPA has their own. At the bottom of the SB form, it says to mail or fax it to them.

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1 hour ago, krow36 said:

Was there an indication that the TPA used the same plan # for all the Security Benefit options? Or did NEA Direct Invest have its own plan #? Getting the plan # has been an annoying snag for many folks who were the first in their district to choose NEA Direct Invest.

I think that Security Benefit's Salary Reduction Agreement (which includes the TPA's plan #, is only of use to Security Benefit if the district/TPA has their own. At the bottom of the SB form, it says to mail or fax it to them.

SB just called me and spoke to me. I received my plan ID number from them and my account # (which is my SS#). I asked if i needed to send a SRA form to them as well as my HR and they so no....for me to just work with my HR in regards to the SRA form and paycheck deductions.

 

Also, when I filled out my allocations, the SB rep just told me that I wasnt able to get the "admiral" funds with my plan. For instance:

  • So, i put down i wanted VFIAX (admiral)(vanguard 500 index), but i cant get this with my plan she said. 
  • instead, i would be getting VFINX (Vanguard 500 Index Fund Investor Shares).

So, basically i cant do admiral funds. 

Can someone help me out with this? I am a little confused and am I still ok ?

 

thanks

Curt

 

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Thanks for the info on the plan #. As for the Admiral class of the 500 Index fund, you can only choose funds that are on the SB list for NEA Direct Invest. However, instead of using the 500 Index fund, which only covers large cap stocks and some mid caps, we suggested you use the Total Stock Market Index fund. TSM covers large, mid and small caps---the whole US stock market. It's more diversified than 500 Index, which is desirable. In the past, SB used the Admiral class on TSM. The Vanguard website says that they have done away with the  Investor class for Index 500 and TSM---they only use Admiral class now? 

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If you look at the Quarterly Performance page, you'll see that they are using the Admiral class for both 500 Index and for TSM. I think the rep you talked to is incorrect.

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For what it's worth Vanguard upgraded my investor share fund to admiral shares at about the same time that they started working with the Newport Group.  This was a target date fund, so I'm not sure if they also do this for the S&P fund.  It does look like VFINX might be a fund that they are phasing out and not offering to new customers.  I would get the total stock market (VTSAX) before either S&P fund if given the choice.

 

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They are not phasing out 500 Index, just eliminating the Investor class. Everybody gets to use the Admiral class. You do have a choice, don't you.

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30 minutes ago, krow36 said:

There not phasing out 500 Index, just eliminating the Investor class. Everybody gets to use the Admiral class. You do have a choice, don't you.

Yes, this.  VFINX is not listed on Vanguard's site as an available fund, but I could still find today's price via google.

There isn't a huge difference between the Admiral share S&P and VTSAX.  Their performance and expense ratio are very close.  I like that you get a little more diversification with VTSAX, and would use it when available.

 

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13 hours ago, krow36 said:

If you look at the Quarterly Performance page, you'll see that they are using the Admiral class for both 500 Index and for TSM. I think the rep you talked to is incorrect.

Ok, I think I will call back and ask about the Admiral class and see if it is available. If so, I will switch over to the VTSAX , etc.........

thanks!

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13 hours ago, krow36 said:

Thanks for the info on the plan #. As for the Admiral class of the 500 Index fund, you can only choose funds that are on the SB list for NEA Direct Invest. However, instead of using the 500 Index fund, which only covers large cap stocks and some mid caps, we suggested you use the Total Stock Market Index fund.

 

again. all the help is appreciated

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On 11/4/2020 at 1:55 PM, msucurt said:

So, i put down i wanted VFIAX (admiral)(vanguard 500 index), but i cant get this with my plan she said. 

 

5 hours ago, msucurt said:

Ok, I think I will call back and ask about the Admiral class and see if it is available. If so, I will switch over to the VTSAX , etc

A few things to know:

  1. Vanguard used to have investor shares and admiral shares. The investor shares had a lower minimum required investment and a higher expense ratio. Some time ago Vanguard eliminated the investor shares and lowered the minimum required investment for their admiral shares.
  2. So being told you don't have access to admiral shares is effectively like being told you don't have access to Vanguard funds at all (minor exceptions like the Target Date funds never had admiral shares and Vanguard does issue Institutional shares...but those are just details). So you can safely assume the person who told you that is incorrect and fairly ignorant.
  3. If somebody correctly told you that you don't have access to admiral shares then I'm concerned you enrolled in something other than Security Benefit's NEA DirectInvest. The fact that you're even talking to somebody about investment options also points to that direction. Security Benefit's NEA DirectInvest is a self-directed plan, which means you login to their site and pick your investments yourself. There is no rep, which is why the fees are so low.
  4. Your comments perhaps suggest you're conflating VFIAX vs VTSAX with Investor vs Admiral shares. Both VFIAX and VTSAX are Admiral shares. However, VFIAX tracks the S&P 500, which are 500 large companies, but VTSAX tracks the CRSP US Total Market Index, which are 3,543 companies that represent the entire US economy.

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20 hours ago, EdLaFave said:

 

A few things to know:

  1. Vanguard used to have investor shares and admiral shares. The investor shares had a lower minimum required investment and a higher expense ratio. Some time ago Vanguard eliminated the investor shares and lowered the minimum required investment for their admiral shares.
  2. So being told you don't have access to admiral shares is effectively like being told you don't have access to Vanguard funds at all (minor exceptions like the Target Date funds never had admiral shares and Vanguard does issue Institutional shares...but those are just details). So you can safely assume the person who told you that is incorrect and fairly ignorant.
  3. If somebody correctly told you that you don't have access to admiral shares then I'm concerned you enrolled in something other than Security Benefit's NEA DirectInvest. The fact that you're even talking to somebody about investment options also points to that direction. Security Benefit's NEA DirectInvest is a self-directed plan, which means you login to their site and pick your investments yourself. There is no rep, which is why the fees are so low.

Yep, just called SB and spoke to someone there. I absolutely am in DIRECT INVEST and I am eligible for the "ADMIRAL" funds. We went over all my allocations and what I wanted (VTIAX , VTSAX, ETC...).....everything is good to go. Now  I will fill out the "incoming funds request" forms to get my other 403b transferrred to my DirectInvest account.

  1. Your comments perhaps suggest you're conflating VFIAX vs VTSAX with Investor vs Admiral shares. Both VFIAX and VTSAX are Admiral shares. However, VFIAX tracks the S&P 500, which are 500 large companies, but VTSAX tracks the CRSP US Total Market Index, which are 3,543 companies that represent the entire US economy.

thanks!!

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Step 2 on the SB Direct Invest Incoming Funds Request says:

“2. Please contact your current carrier for any form requirements it may have for transferring money to another company. “

This is critical to moving your balances from VOYA and National Life Group. The transfer will not happen unless the transfer forms of VOYA and National Life Group are completed to their satisfaction. After receiving the forms, you will need to talk to them about their requirements. They will not accept SB’s transfer form as sufficient to make the transfer. Other posters have found that annuity company transfer forms can be a serious challenge. They have parts to be filled out and signed by you, and a part to be filled out and signed by Security Benefit, and a part to be signed by your district's TPA, all done in the correct order. Let us know how it goes. Discussing your questions may help other posters in the future. 

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On 10/28/2020 at 5:40 PM, krow36 said:

That 5k to 7k that you want to invest for your retirement can be used to fund a Roth IRA for 2020. You can have more than 1 Roth IRA account, so I would set one up with Vanguard. It can be empty until you put money in it. Then you can fund it and then get Vanguard to help you transfer the AF Roth IRA. 

Set up my Vanguard Roth IRA account and filled out the paperwork to have both my current ROTH IRA's to be transferred (American Funds Capital Group and TIAA). Once those funds get transferred, I will set up another ROTH IRA account and use the extra $5,000 to invest.

On this webpage, click on “Enroll Now” to access the steps to get started on the NEA Direct Invest 403b.

https://www.nearetirementprogram.com/nea-directinvest

Let us know if you need help with NEA Direct Invest forms. Don't expect much help from Security Benefit. And none from NEA. NEA Direct Invest is a super-low-cost 403b plan but there's no hand-holding or advice with it.  

 

 

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