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Scottyd

Urban Legend Or Truth?

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"I, too, have seen some despicable behavior from agents in my days teaching. Difference is, I don't extrapolate these things to apply to all agents"

 

I believe that I stated, "In selling these funds the more aggressive sales agents will do everything ...........", (not all sales agents).

 

 

You also stated, "From my prospective, I feel that it's very costly for average(403b unwise) teacher to buy these various load funds and annuities from agents who sell them. It seems to me that the agent operates legally, but misleads and takes advantage of the financially uneducated teacher."

 

Not the more aggressive sales agents, but "the agent." That's an overgeneralization. It's a popular one here, and it'll no doubt score you points with the majority of posters here, but I feel compelled to point it out regardless.

 

As to the remainder of your post...

 

"A question arises, What percentage of sales agents should be allowable to have poor unethical sales behaviors?...I think that the figure should be zero or close to. People who are investing their savings deserve a fair break."

 

I couldn't agree more. And dishonest, unethical agents should be called on it. Indeed, we should keep a separate post here where we can post the names and companies of agents who have pulled the garbage you refer to, so other teachers wouldn't fall prey.

 

By the same token, I just regret the standard implication that MOST agents fall into this category, because that hasn't been my experience. Again, using the teaching profession as a parallel, we all know teachers who aren't giving it their all. Some of them are protected by union contracts...and as a result, I hear frequently that the real key to solving education in this country is to do away with this pesky thing called tenure. How come teachers don't have to "earn" it, I'm asked?

 

The gross oversimplification of the teacher who's coasting on tenure until he or she hits 25 years and can retire with a generous taxpayer-funded pension is at least as insulting, I would think, as the gross oversimplification of the unethical agent who lurks in lunchrooms ready to attack unsuspecting teachers, and ready to promise everything and deliver nothing, all in their zeal to make the sale.

 

Neither one is a terribly accurate indicator of their respective professions.

 

 

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I beleive that this is a forum about 403b's. I keep on reading comparisons of sales agents to teachers for analyses. Can we simply talk about agents in this discussion, and reserve conversation about teachers, to a teacher forum.

 

I agree that improper sales by an agent and impropriety by centers of influence(union, school officials, distorted charges by companies who sales agents work for) need to be reported; perhaps on this site, or to a regulartory agencies, to the school district, a newspaper or wherever it would be most effective.

 

To clarify my position, I do believe that it's very costly for an average(403b unwise) purchaser to buy various funds from companies that have distorted charges (which are really not presented as so), especially in the light that there are companies that are able to successfully operate while giving what I consider fair charges i.e. Vanguard and TICref among others.

 

I think that it would also be a good idea to list various 403b providers with associated expenses on this site.

 

Ira

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Ira,

 

Sounds to me like you consider "fair charges" to be those administered by no-load companies. Which means you're judging various carriers based entirely on their cost structure: i.e., the lowest cost wins. That's fine for some people, as we've discussed ad nauseum in this forum. It doesn't quite fit the bill for others, whose needs are somewhat greater than an 800 number and an anonymous advisor who happens to pick up when they call. Hence my feeling that both formats are well-supported: no-loads for those who need no further assistance, full service for those that require such assistance.

 

As far as comparing agents to teachers is concerned, bear in mind that this is a forum FOR teachers, BY teachers. The comparisons are inevitable.

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Hi Mr. French Teacher,

 

I've noticed that you have been posting on this site since Dec 03 at a fairly good rate, so even though I don't agree with a good part of what I recently read, I think that it would be wise for me not to comment on the individual points that you presented, in the light that you have probably read comments from consumer oriented posters on behalf of teachers and other employees covered by 403b's time and time again that disagree with the views that you present about the 403b industry primarily supporting the sales agents and the load type companies first, and teachers second ( as any good salesman or industry representative would).

 

Even though I disagree with you, I respect your ability to persevere under much adversity in this consumer oriented discussion group trying to help teachers.

 

 

 

 

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I'm a mister. And thanks for the thoughts, Ira. I welcome an intelligent exchange of points of view with anyone reasonable enough to attempt to see both sides of things. I certainly understand, and actively advocate, for the availability of the no-load funds that you have mentioned here. Where we part ways, I suppose, is that I still feel that both approaches (no-load and full-service) should be made available to people like me and my colleagues. Since there is clearly no consensus on any single approach that would be perfect, there's no reason to anoint one to the exclusion of the other.

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Guest Sierra

Since there is clearly no consensus on any single approach that would be perfect, there's no reason to anoint one to the exclusion of the other.

===============================================

Mr. French Teacher:

 

Now that you finally told us your gender, I look forward to the day when you will see your way clear to divulge your given name.

 

Why don't you make this assertion to your NYSUT which clearly has "anointed" the no-load approach to the exclusion of the load approach when it comes to their own employees' 401(k) plan.

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Guest TR1982

FT,

Why do you waste your time with this? Sierra is so pedantic that he won't acknowledge any other point of view. To do so would undercut his view of the world which is that everyone is out to screw him. Yawn.

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Why don't you make this assertion to your NYSUT which clearly has "anointed" the no-load approach to the exclusion of the load approach when it comes to their own employees' 401(k) plan.

 

Unlike you, Joel, I don't see fit to meddle in the affairs of others. If NYSUT and their staff has an arrangement that works for them, why should I get in the middle of it?

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Mr. French Teacher,

 

Since I'm a new poster, can you please enlighten me by telling where your coming from. Are you a load fund salesman, a paid (load fund) industry representative or a French teacher who has gone off the wall and advocates load funds on this site intended to help teachers and other 403b consumers.

 

 

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Mr. French Teacher,

 

Since I'm a new poster, can you please enlighten me by telling where your coming from. Are you a load fund salesman, a paid (load fund) industry representative or a French teacher who has gone off the wall and advocates load funds on this site intended to help teachers and other 403b consumers.

 

Ira, I'm a teacher who has been greatly assisted by one of the full-service agents that is so routinely maligned on this board. And I'm not an advocate of load funds per se. I AM an advocate of having both no-load and full-service platforms available to all teachers, since I've seen so many teachers helped by the presence of both. If that means I've gone "off the wall" in your eyes, so be it.

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Hi ira,

From time to time, we get teachers who share the financial advisers’ positions. It’s interesting to note that these teachers all share these characteristics and forum protocol:

1. remain anonymous

2. rave about their one financial adviser which they also keep anonymous

3. sometimes articulate and clever

4. make no references to reading materials or investment authors. They seem to have a TOTALLY self-contained investment knowledge base that is only good for them. I guess that is the reason they need a financial adviser.

5. prefer negative attention by arguing and distracting with people they disagree rather than answer the poster's questions. They give lip service to the profound problems of the 403b world and do not acknowledge nor do they want to learn about diversification, low fees, indices, all of the stuff we know is important and are from investment authors we have read and studied, such as Bogle, Bernstein, Siegel, Clason, Malkiel, Ferri, Swedroe, just to name a few.

6. because of all the above, the information they provide is more defensive than offensive and thus is basically useless because they seem to agree that they found a way to beat the indices, found a better product than Vanguard or TIAA CREF but the real problem is that they will never share what exactly is the product is nor their financial adviser, claiming that their "friends" in the financial world will be attacked. This is profound nonsense, its insulting and wrong and more of a big ego trip than anything else.

 

By contrast:

I know and have met Dan, the webmaster, Joe M, Scotty, you, Dan R. Although I have not met Joel, I know his first and last name, that he is retired and used to work for a pension fund in NY. Although I profoundly disagree with Chuck, I know who he is, his company, products and his website. While he can speak for himself, he probably does not take himself seriously or important enough to think that we think about him all the time on this site. He provides information and answers questions to more technical aspects of 403b. He does not, IMO, have a big ego to feed.

I also know the people at TIAA CREF West Coast office, I know the editors at the LA Times, one or two at the WSJ, the San Diego Tribune, Forbes, NY Times, and US News and World Report because I have talked to them over the years.

But I don’t know anything about these anonymous posters who continue to expose their profound misunderstanding of what these great authors I cited above. It’s not about what you or I say about investing, it is about spreading the word of those great investment authors. And it’s about learning to do this without an adviser. Some people are very threatened by that. It is exactly why the 403b world needs reform.

For the record as Scotty said: We reject costly products and costly services.

These anonymous teachers are for the most part in lock step with the current status quo of the 403b world and that is to keep 403b products secretive, advisers anonymous and continue to work with clients 1X1 in the cafeteria.

This site is the opposite. It is open and interactive where all points of view are expressed.

Steve

 

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Steve,

 

Thanks for the informative note. I agree with everything that you posted much of which became apparent after only a couple of posts.

 

Additionally, I tend to think that these anonymous posters are not teachers as they claim, but working in the load fund industry and are posting solely to lessen the effectiveness of this site.

 

Ira

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Hi ira,

Actually I think opposition posts add a lot of credibility and validity to what we have to say about 403b reform. It’s similar to a research study design methodology, when you have an experimental group (403b reform people) and a control group (the pros). The results of the experimental group cannot be seen very well until we get contrasting results from the control group for comparison purposes. One of the major thinking processes that we teach in elementary grades is contrast and compare. Thus, readers can judge for themselves on what is the best route to go. In the end, when the newbies talk with a financial adviser, they will not be able to act naive any longer. One visit to this site spoils their naiveté forever. That is when our job is finished.

The openness by itself is one of the most powerful assets for us reformers, especially in contrast to the secrete world of 403b. This open exchange of ideas and strategies for the new reader reveals very clearly that we are open to other POVs in an open and honest exchange. Let them post all they want. I welcome it.

There is an old saying, give them enough rope and they will hang themselves.

See ya soon,

Steve

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Steve, I'm so glad I have your blessing to continue posting here! It was keeping me up nights.

 

Your stereotype of teachers who agree with financial advisors was quite entertaining. I found it particularly amusing that you're willing to brand those of us with an opposing viewpoint as thriving on negative attention, while giving good old Joel a free pass since, after all, you know his first and last name. The fact that he has been exposed here as a liar is apparently immaterial.

 

The difference between you and Joel, Steve, is that in your zeal to promote no-load funds to the exclusion of all others, I have never seen you make anything other than factual observations. Your recent rants about anyone who disagrees with you aside (and frankly, that too is your opinion, and you're entitled to it), you've never misrepresented a single thing in anything that I've read from you. Joel, on the other hand, has made countless misrepresentations and told countless lies, all in his haste to convince a half-million teachers in New York that they have a much, much worse deal than they really have. As I have said countless times, I have no problem with an HONEST exchange of ideas. I disagree with you frequently, Steve, but I can at least believe what you are saying when you write. But I resent people who come on here and say whatever they feel like saying, even if it has only a casual relationship with the truth.

 

Dan Otter, the guy who runs the site, has conveyed his appreciation to me for my participation in this forum. If the remainder of you feel differently, well, I can certainly live with that. I've lived with worse.

 

All I have ever said here is that there is more than one way to build up an impressive retirement nest egg using 403(b) plans. The way you outline is certainly the cheapest. It may or may not be the most effective, depending on the level of engagement among your colleagues. If you actually work in a district where the majority of teachers read Bogle, Bernstein, Siegel, and Malkiel in their spare time, then the no-load business must indeed be booming! A quick glance around ME tells me that this is not the reality in which I live. Agents thus serve an important function in our little society: more often than not, they enable an early start to investing which otherwise would not take place.

 

Someday I may well outgrow my advisor and invest on my own, using some of these wonderfully cheap funds that you guys continually tout. Until then, I'm happy I do have an advisor who's competent and engaged, and I feel bad for those who have the kinds of advisors that aren't.

 

One last observation: it's funny that you charge those who choose NOT to post their full names at every opportunity with having big egos to feed. It sort of stands to reason, I would think, that if I really had a big ego to feed, I would feature my name prominently in each and every one of my posts. Ego is not what motivates me here, or anywhere else in my life.

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