lindisfarne wrote:I've just asked my employer to consider adding Vanguard to the options we have in our TIAA-CREF 403b.
I'm quite ignorant of the administrative side. I'm particularly wondering
Does adding investment options to a 403b (or 401k) plan cost the employer more?
Perhaps it doesn't if the company (Vanguard) finds it advantageous to get more customers, although what is the advantage to TIAA-CREF to add outside companies into the mix (although perhaps this helps TIAA-CREF to get & retain big, lucrative accounts?)
Any additional explanation of relevant information anyone want to provide would be appreciated. I'm so ignorant of the factors which would go into an institution's decision of what options to include that I don't even know where to start. We seem to have a quite limited number of options compared to some institutions (I have fewer options now even among T-C & CREF funds than I had at a previous, similar sized employer). I would guess that if cost increases as choice increases, the per capita cost decreases as # of employees increases, so perhaps the size of the institution is a partial factor.
Just curious -- what TIAA CREF funds are accessible to you.
I have T-C and am quite happy. I agree that the expense ratios could be lower but at below 0.5%, I am satisfied. It has a total of 26 funds (all TIAA CREF) which include about 11 Lifecycle funds. I only use three of the funds.
CREF Stock - An all-in-one fund with Domestic (70%) and International (30% = 25% Developed + 5% Emerging markets)
TIAA Real Estate which provides for direct ownership of real estate
TIAA Traditional - guaranteed 3% minimum
That's it - my perfect 3 fund KISS portfolio. It would be a 2 fund with CREF Stock and TIAA Traditional but the TIAA Real Estate Fund is the spicy sauce on top.
Too much choice can be paralyzing for many people. Seehttp://www.google.com/webhp?hl=en&tab=ww#hl=en&tbo=d&sclient=psy-ab&q=too+much+choice+in+retirement+accounts
Other than bogleheads, I doubt if the ordinary retirement plan participant would like 50 funds to chose from.