Which 403b provider to choose?

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phantom3452
Posts: 6
Joined: Mon May 07, 2018 7:19 pm

Which 403b provider to choose?

Post by phantom3452 » Thu Aug 02, 2018 11:37 am

Wife is starting a job as a teacher in texas, and here are the options for 403b providers. I don't recognize most of the names, and checking a few I found they only offer crazy high fee mutual funds or none at all.

Does anyone have any recommendations on which to use?
Which of these are worth looking at more closely, and which of them should I avoid at all cost?

American Fund/Capital Guardian
Americo Financial Life/Annuity
Aspire Financial Services
Athene Annuity and Life (Aviva)
AXA Equitable Life Insurance Company
Fiduciary Trust Intl-Franklin Templeton
Great American Insurance Group
GWN/Employee Deposit Acct
Horace Mann Life Ins. Co.
ISC Group Inc
Jefferson National Life
MetLife
Modern Woodmen of America
National Life Group (LSW)
North American Co for Life and Health
Oppenheimer Shareholder Svcs.
PlanMember Services Corp.
Reassure America Life Ins. Co.
RiverSource Life Insurance Co of NY
Security Benefit
The Legend Group/ADSERV
TransAmerica
VALIC
Voya Financial (Reliastar)
Voya Financial (VRIAC)
Waddell & Reed Inc.

Rupert
Posts: 3740
Joined: Fri Aug 17, 2012 12:01 pm

Re: Which 403b provider to choose?

Post by Rupert » Thu Aug 02, 2018 11:49 am

They're all awful, but you might find this website helpful in sorting through them: https://403bwise.com/

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vineviz
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Re: Which 403b provider to choose?

Post by vineviz » Thu Aug 02, 2018 12:15 pm

If you need a place to start, I'd look at these five first as possibly offering the least expensive plans of the bunch from which you have to choose.
  • Modern Woodmen of America
  • PlanMember Services Corp.
  • American Fund/Capital Guardian
  • GWN/Employee Deposit Acct
  • Security Benefit
"Far more money has been lost by investors preparing for corrections than has been lost in corrections themselves." ~~ Peter Lynch

MNGopher
Posts: 279
Joined: Tue Jun 16, 2015 1:44 pm

Re: Which 403b provider to choose?

Post by MNGopher » Thu Aug 02, 2018 12:51 pm

Aspire sometimes has some options that are OK, but not great. Valic and Horace Mann are popular in my area, but they have terribly high fees.

anonenigma
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Joined: Thu Apr 21, 2011 11:58 pm

Re: Which 403b provider to choose?

Post by anonenigma » Thu Aug 02, 2018 12:56 pm

See if PlanMember Direct is available. Otherwise they're all awful. See if there's a better 457(b) plan she can access,

KESP
Posts: 129
Joined: Sat May 07, 2016 8:24 pm

Re: Which 403b provider to choose?

Post by KESP » Thu Aug 02, 2018 2:36 pm

I have Aspire and have access to admiral shares of just about every Vanguard fund you would want. I’ve been very happy with them, but don’t expect any hand-holding. I pay .15% on assets annually, plus $40 administrative fee a year.

Polenta
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Joined: Sat Feb 24, 2018 11:55 pm

Re: Which 403b provider to choose?

Post by Polenta » Thu Aug 02, 2018 2:48 pm

Kesp is right on. Aspire is great choice if your self direct the account which means you use no salesperson. They can explain on the phone how to do it. You can tap into any Vanguard fund at a very low cost. Fund cost plus a .15 administrative fee. So if you go say Vanguard Admiral Total Stock Market Index,the fund costs .04% expense ratio you will pay about .19% total expense. That is pretty darn good/low. Your other choices are not good because of high fees and because most sell insurance products like annuities which are basically a huge rip-off

gwrvmd
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Location: Calabash NC

Re: Which 403b provider to choose?

Post by gwrvmd » Thu Aug 02, 2018 3:07 pm

I think Security Benefit is the best on the list, sometimes it is only available through the State Teachers Assn
Be sure to check Securitybenefit.com before you decide.....Gordon
On The Security Benefit website: Individuals>prices and performance>retirement plans>NEA Directinvest 403(b)7....a little hidden but it is there.....do only Directinvest as others have said
Last edited by gwrvmd on Sat Aug 04, 2018 12:04 am, edited 1 time in total.
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BashDash
Posts: 586
Joined: Mon Nov 28, 2016 12:31 pm

Re: Which 403b provider to choose?

Post by BashDash » Thu Aug 02, 2018 4:26 pm

Only use the "direct invest" option of security benefit. Search it on the forum for info. Pm me with questions.

Check out 403bwise.com too for more info.

Polenta
Posts: 15
Joined: Sat Feb 24, 2018 11:55 pm

Re: Which 403b provider to choose?

Post by Polenta » Thu Aug 02, 2018 8:35 pm

BEWARE Security Benefit is loaded with bad choices . The one good option is Direct Invest as mentioned. Be careful you don't end up in something you don't want and that is high fee.

PiperCub
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Joined: Tue Aug 06, 2013 4:23 pm

Re: Which 403b provider to choose?

Post by PiperCub » Fri Aug 03, 2018 1:49 am

We have similar options in my school district, and I called every single one to find out if they had a Direct option. Plan Member Services was the only one who did, and that took a lot of digging to discover. Call and ask them if they have Plan Member Direct, and you can manage it yourself. Lots of Vanguard funds to choose from.

Another option is to look into whether her district allows investment in the state's 457 plan. Our state has an outstanding 457 option, but our district refuses to give us access to it. Very frustrating.

phantom3452
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Joined: Mon May 07, 2018 7:19 pm

Re: Which 403b provider to choose?

Post by phantom3452 » Fri Aug 03, 2018 9:23 pm

Looks like Texas doesn't have Vanguard on Aspire, and Security Benefit I could find anything listed with less then 1.8% fee.

https://oapi.trs.state.tx.us/FOTB/do/me ... mpanySetup


The 457 plan looks even more sparse, it has a small subset of the 403b options, but nothing else...


Best I can tell, we're better off just using a taxable brokerage account or contributing to a 529 for the tax deferred earnings and then taking the 10% fee later on in retirement.

gostars
Posts: 439
Joined: Mon Oct 09, 2017 7:53 pm

Re: Which 403b provider to choose?

Post by gostars » Fri Aug 03, 2018 9:40 pm

Vanguard (as The Vanguard Group) and TIAA-CREF are on that list you linked, are those not available?

phantom3452
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Joined: Mon May 07, 2018 7:19 pm

Re: Which 403b provider to choose?

Post by phantom3452 » Fri Aug 03, 2018 11:18 pm

Unfortunately they aren't, the particular school district only offers the providers listed in the original post. The fees from that link should be accurate for the providers listed though...

gostars
Posts: 439
Joined: Mon Oct 09, 2017 7:53 pm

Re: Which 403b provider to choose?

Post by gostars » Sat Aug 04, 2018 1:29 am

ISC looks not terrible? S&P 500 at 0.17%, small caps at 0.23%, aggregate bond at 0.30%, total international at 0.32. Not great, but it beats the hell out of the rest of that garbage.

A440
Posts: 230
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Location: NJ

Re: Which 403b provider to choose?

Post by A440 » Sat Aug 04, 2018 6:57 am

AVOID AXA Equitable.

BashDash
Posts: 586
Joined: Mon Nov 28, 2016 12:31 pm

Re: Which 403b provider to choose?

Post by BashDash » Sat Aug 04, 2018 8:49 am

Check out the security benefit direct investment option more. Call multiple times until they offer it to you. Takes some serious digging but I think you can get it. Be persistent. Their advisors will act like it doesn't exist. Even some customer service people may not know about it. Call and update the thread!

krow36
Posts: 1900
Joined: Fri Jan 30, 2015 6:05 pm
Location: WA

Re: Which 403b provider to choose?

Post by krow36 » Sat Aug 04, 2018 1:18 pm

If Security Benefit is on your district’s provider list, you can use their NEA Direct Invest. Use only the Vanguard Admiral index funds. The only other fee is $35/year for balances under 50k. Look it up on the SB website, google it, or use the Boglehead search feature. As Bash Dash says, if your district isn’t aware of this option, you should use it anyway. They can choose their vendors but not which of the vendor’s options you can use.

Aspire has all the VG funds, as mentioned adds .15% and charges $40/yr.

phantom3452
Posts: 6
Joined: Mon May 07, 2018 7:19 pm

Re: Which 403b provider to choose?

Post by phantom3452 » Sat Aug 04, 2018 11:22 pm

Aspire doesn't offer the Vanguard funds to Texas Teachers...

Awesome, thanks for the ISC suggestion, looks like possibly promising.

The direct invest with Security Benefit looks interesting... I'm going to look into that further, I found this about it, and looks like it does have some vanguard funds as well...
https://www.securitybenefit.com/individ ... nvest.aspx

texasdiver
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Location: Vancouver WA

Re: Which 403b provider to choose?

Post by texasdiver » Sun Aug 05, 2018 1:18 am

Former Texas teacher here.

I would ask why your district doesn't allow investment with Fidelity or Vanguard. Both are on the list of TRS Certified Companies so there is no reason why the can't do it: https://www.trs.texas.gov/Pages/403b_ce ... anies.aspx

I was able to use Vanguard with my previous district in Texas and had no added fees whatsover other than the underlying fees in the Vanguard funds. Only Vanguard Investor Shares were availble through the 403(b) so slightly higher fees than the Admiral shares that would have been available in an IRA. But still, pretty good.

My district used a company called the OMNI Group to administer all its salary reduction agreements for 403(b) and 457 retirement plans. They didn't care what provider I used as long as it was on the TRS list. You basically had to act like your own broker and fill out the salary reduction request yourself rather than paying a salesman to do it if you wanted to use a company like Vanguard or Fidelity that doesn't pay broker commissions. For me it was a 2-step process.

Step 1: Open an 403(b) account directly with Vanguard. There are online .pdf forms for that.
Step 2: Complete the salary reduction request and submit to OMNI requesting that your payroll reduction be sent to the Vanguard account number you just opened yourself. https://www.omni403b.com/participants.aspx?loadver=0

There wasn't any interaction with the district itself in the process, only with Vanguard to open the account and OMNI to process the salary reduction request.

I understand different districts do things differently. But there is no legal or bureaucratic reason why your district can't do the same. Perhaps no one has ever asked.

PS, I'd also look into 457 plans. My district had one available on paper that no one really used because no one knew about it. But same deal.

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