Where to get info on stable value fund

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Optimistic
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Where to get info on stable value fund

Post by Optimistic »

My new employer offers a stable value fund in its 401k (administered by Fidelity). The fund is listed as "Prudential Fixed Income Fund". The description states:
Objective
The Prudential Fixed Income Fund (the "Fund") is a client-specific experience-rated fund for plans with large Stable Value assets that seeks to provide stable crediting rates, while ensuring the safety of invested assets.

Strategy
Principal and accumulated interest are fully guaranteed by Prudential Retirement Insurance and Annuity Company (PRIAC). The guaranteed interest rate is announced in advance and is guaranteed for a one year period. A minimum rate will apply. Experience rated general account stable value product that provides client specific crediting rates. The Fund invests in a broadly diversified, fixed-income portfolio within PRIAC's general account. The portfolio is primarily invested in public bonds, commercial mortgages and private placement bonds.
I am trying to find out what the "guaranteed interest rate" is for the stable value fund. I've contacted my HR department and asked them, and they directed me to Fidelity. Fidelity says they only have what the employer provides, which is essentially what I quoted above. When I contacted my HR again, they said they only have what Fidelity provides them (again, what is quoted above).

This is the first time I've had a stable value fund offered in a 401k, so maybe I'm not asking the right questions. Does anyone have a suggestion of how I can obtain the "guaranteed interest rate" of this stable value fund? I'm interested in using the fund for a good portion of my bond allocation if it offers a decent rate.

Thanks in advance!
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Godot
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Re: Where to get info on stable value fund

Post by Godot »

Optimistic wrote: Mon Sep 13, 2021 2:20 pm My new employer offers a stable value fund in its 401k (administered by Fidelity). The fund is listed as "Prudential Fixed Income Fund". The description states:
Objective
The Prudential Fixed Income Fund (the "Fund") is a client-specific experience-rated fund for plans with large Stable Value assets that seeks to provide stable crediting rates, while ensuring the safety of invested assets.

Strategy
Principal and accumulated interest are fully guaranteed by Prudential Retirement Insurance and Annuity Company (PRIAC). The guaranteed interest rate is announced in advance and is guaranteed for a one year period. A minimum rate will apply. Experience rated general account stable value product that provides client specific crediting rates. The Fund invests in a broadly diversified, fixed-income portfolio within PRIAC's general account. The portfolio is primarily invested in public bonds, commercial mortgages and private placement bonds.
I am trying to find out what the "guaranteed interest rate" is for the stable value fund. I've contacted my HR department and asked them, and they directed me to Fidelity. Fidelity says they only have what the employer provides, which is essentially what I quoted above. When I contacted my HR again, they said they only have what Fidelity provides them (again, what is quoted above).

This is the first time I've had a stable value fund offered in a 401k, so maybe I'm not asking the right questions. Does anyone have a suggestion of how I can obtain the "guaranteed interest rate" of this stable value fund? I'm interested in using the fund for a good portion of my bond allocation if it offers a decent rate.

Thanks in advance!
Contact Prudential.
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dbr
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Re: Where to get info on stable value fund

Post by dbr »

Write a letter to the CEO of your company to politely share that you are frustrated that you can't find the referred to rate and don't know if you should invest in this fund or not. Tell him you are a new employee and want to take best advantage of the benefits offered by the company.
tashnewbie
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Re: Where to get info on stable value fund

Post by tashnewbie »

Optimistic wrote: Mon Sep 13, 2021 2:20 pm My new employer offers a stable value fund in its 401k (administered by Fidelity). The fund is listed as "Prudential Fixed Income Fund". The description states:
Objective
The Prudential Fixed Income Fund (the "Fund") is a client-specific experience-rated fund for plans with large Stable Value assets that seeks to provide stable crediting rates, while ensuring the safety of invested assets.

Strategy
Principal and accumulated interest are fully guaranteed by Prudential Retirement Insurance and Annuity Company (PRIAC). The guaranteed interest rate is announced in advance and is guaranteed for a one year period. A minimum rate will apply. Experience rated general account stable value product that provides client specific crediting rates. The Fund invests in a broadly diversified, fixed-income portfolio within PRIAC's general account. The portfolio is primarily invested in public bonds, commercial mortgages and private placement bonds.
I am trying to find out what the "guaranteed interest rate" is for the stable value fund. I've contacted my HR department and asked them, and they directed me to Fidelity. Fidelity says they only have what the employer provides, which is essentially what I quoted above. When I contacted my HR again, they said they only have what Fidelity provides them (again, what is quoted above).

This is the first time I've had a stable value fund offered in a 401k, so maybe I'm not asking the right questions. Does anyone have a suggestion of how I can obtain the "guaranteed interest rate" of this stable value fund? I'm interested in using the fund for a good portion of my bond allocation if it offers a decent rate.

Thanks in advance!
I'm in a similar boat. Recently changed jobs, and my current 401k offers a Prudential Guaranteed Income Fund ## (numbers that I won't post, in case they are plan-specific). There's no fund information on the 401k website. I asked the 401k administrator if they have any information, and the representative said it is odd there is no information and that a ticket would be started to see why. The rep said it would take a while for them to address this. I had this conversation ~2 months ago, and nothing has changed.

I Googled to see if I could find an answer, and I got what looked to be the current guaranteed rate, but I'm not getting those returns. At this point, I just calculate the estimated annualized return from the monthly returns I've received so far. The rate is still higher than the total bond index, so I'm going to keep most of my fixed income in the SVF until rates start changing.

ETA: I googled again today, and I think I previously landed on a fund fact sheet for Q1 2021 that showed the fund's return, and that amount does align with the return I've received so far. Maybe try doing a deeper Google search? I couldn't find anything on Prudential's website for my plan's specific fund.
Last edited by tashnewbie on Mon Sep 13, 2021 2:53 pm, edited 1 time in total.
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Stinky
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Re: Where to get info on stable value fund

Post by Stinky »

This is a bizarre circular situation you find yourself in. I’m surprised that HR can’t tell you what the rate is.

Two additional suggestions -

Is there a website that you can log into for the 401k plan? If so, there might be some link like “ezplore my options”. If you click through on the stable value link, and on every sub-link below that, you might find the rate.

Can you ask your direct manager about this? He/she might have the stable value option in the plan. Alternatively, they might know a more productive way to get the answer out of HR.
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arcticpineapplecorp.
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Re: Where to get info on stable value fund

Post by arcticpineapplecorp. »

if you look at the prudential site for your specific plan, you should have access to their prospectuses (mine is called "investment lineup"). When I click on my stable value fund it shows:

Fund Issuer
Invesco

Asset Category
Stable Value

Annualized Stable Value
Options crediting rate for
the 2nd Quarter 2021: 1.783%

Less - Fees applicable
to Stable Value Fund
(Operating Expense): 0.257%

Annualized Stable Value
Option crediting rate for
the 2nd Quarter 2021:
(net of Fee): 1.527%

They change this quarterly and post it at the site. Can you find that?
It's hard to accept the truth when the lies were exactly what you wanted to hear. Investing is simple, but not easy. Buy, hold & rebalance low cost index funds & manage taxable events.
exodusNH
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Re: Where to get info on stable value fund

Post by exodusNH »

Optimistic wrote: Mon Sep 13, 2021 2:20 pm My new employer offers a stable value fund in its 401k (administered by Fidelity). The fund is listed as "Prudential Fixed Income Fund". The description states:
Objective
The Prudential Fixed Income Fund (the "Fund") is a client-specific experience-rated fund for plans with large Stable Value assets that seeks to provide stable crediting rates, while ensuring the safety of invested assets.

Strategy
Principal and accumulated interest are fully guaranteed by Prudential Retirement Insurance and Annuity Company (PRIAC). The guaranteed interest rate is announced in advance and is guaranteed for a one year period. A minimum rate will apply. Experience rated general account stable value product that provides client specific crediting rates. The Fund invests in a broadly diversified, fixed-income portfolio within PRIAC's general account. The portfolio is primarily invested in public bonds, commercial mortgages and private placement bonds.
I am trying to find out what the "guaranteed interest rate" is for the stable value fund. I've contacted my HR department and asked them, and they directed me to Fidelity. Fidelity says they only have what the employer provides, which is essentially what I quoted above. When I contacted my HR again, they said they only have what Fidelity provides them (again, what is quoted above).

This is the first time I've had a stable value fund offered in a 401k, so maybe I'm not asking the right questions. Does anyone have a suggestion of how I can obtain the "guaranteed interest rate" of this stable value fund? I'm interested in using the fund for a good portion of my bond allocation if it offers a decent rate.

Thanks in advance!
It's really difficult to find. In mine, which is a Great West product, it's a completely separate section in the Empower portal. The official "fund" documentation has no reference to it. The rate resets quarterly.

It's basically an insurance product wrapped around the market. (Conceptually similar to how a Whole Life contract works.)

One thing to keep in mind: you may have withdrawal restrictions on the money. You might be limited to a maximum rebalance of X% of the fund per year. (They have to unwind their contracts and can't just have everyone go to $0 all at once.) They may also limit your ability to transfer the money from their fund to a "competing" fund, forcing you to go into something else for some period of time before transitioning back to your desired fund.

If you search for "GWI Fixed Account - Series Class VI", you can see a sample of what these products are.
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Optimistic
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Re: Where to get info on stable value fund

Post by Optimistic »

Thanks for the help. I'll answer some of the responses below.
Contact Prudential
I contacted Prudential (just now). They tried to look up my SSN to find my account. I haven't contributed anything to the stable value fund, so I don't have an account with Prudential. Even if I had contributed to the Prudential stable value fund within my 401k (again administered by Fidelity), I would not expect to have an account with Prudential attached via my SSN. They were not able to provide me with any information.
Write a letter to the CEO of your company to politely share that you are frustrated that you can't find the referred to rate and don't know if you should invest in this fund or not. Tell him you are a new employee and want to take best advantage of the benefits offered by the company.
This is a relatively large, publicly traded company. I would not feel comfortable writing a letter to the CEO.
Is there a website that you can log into for the 401k plan? If so, there might be some link like “ezplore my options”. If you click through on the stable value link, and on every sub-link below that, you might find the rate.
The Fidelity website is where I can log in to my 401k plan. The only information available there is what I quoted in my first post (along with a couple of graphs charting the historic return of the fund).
Can you ask your direct manager about this? He/she might have the stable value option in the plan. Alternatively, they might know a more productive way to get the answer out of HR.
My former employer was acquired by my new employer, which is why I'm a new employee. My manager (she's been my manager for 10+ years) is a new employee at this employer as well. So she wouldn't have any additional information.
if you look at the prudential site for your specific plan, you should have access to their prospectuses (mine is called "investment lineup"). When I click on my stable value fund it shows:
---
They change this quarterly and post it at the site. Can you find that?
I don't have access to any Prudential site that I know of. I contacted Prudential over the phone and they were not helpful.
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Horton
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Re: Where to get info on stable value fund

Post by Horton »

As a rough approximation, you could look at the return over the last month and multiply by 12.
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Re: Where to get info on stable value fund

Post by Stinky »

Optimistic wrote: Mon Sep 13, 2021 2:52 pm Thanks for the help. I'll answer some of the responses below.
Contact Prudential
I contacted Prudential (just now). They tried to look up my SSN to find my account. I haven't contributed anything to the stable value fund, so I don't have an account with Prudential. Even if I had contributed to the Prudential stable value fund within my 401k (again administered by Fidelity), I would not expect to have an account with Prudential attached via my SSN. They were not able to provide me with any information.
Write a letter to the CEO of your company to politely share that you are frustrated that you can't find the referred to rate and don't know if you should invest in this fund or not. Tell him you are a new employee and want to take best advantage of the benefits offered by the company.
This is a relatively large, publicly traded company. I would not feel comfortable writing a letter to the CEO.
Is there a website that you can log into for the 401k plan? If so, there might be some link like “ezplore my options”. If you click through on the stable value link, and on every sub-link below that, you might find the rate.
The Fidelity website is where I can log in to my 401k plan. The only information available there is what I quoted in my first post (along with a couple of graphs charting the historic return of the fund).
Can you ask your direct manager about this? He/she might have the stable value option in the plan. Alternatively, they might know a more productive way to get the answer out of HR.
My former employer was acquired by my new employer, which is why I'm a new employee. My manager (she's been my manager for 10+ years) is a new employee at this employer as well. So she wouldn't have any additional information.
if you look at the prudential site for your specific plan, you should have access to their prospectuses (mine is called "investment lineup"). When I click on my stable value fund it shows:
---
They change this quarterly and post it at the site. Can you find that?
I don't have access to any Prudential site that I know of. I contacted Prudential over the phone and they were not helpful.
Desperate times call for desperate measures. And, based on your responses above, you're in desperate times. :D

If all else fails, put some reasonable amount (say $1,000) into the Stable Value option as close to October 1, 2021 as you can. Then see what the value of your investment is on December 31, 2021. You can figure out an approximate annual interest rate from that.

Doing it this way is not my first, second, or third choice. I truly expect that you'll find someone or someplace that can tell you the interest rate.

But, if all else fails, you can get an answer this way.
It's a GREAT day to be alive! - Travis Tritt
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Horton
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Re: Where to get info on stable value fund

Post by Horton »

Stinky wrote: Mon Sep 13, 2021 3:42 pm
If all else fails, put some reasonable amount (say $1,000) into the Stable Value option as close to October 1, 2021 as you can. Then see what the value of your investment is on December 31, 2021. You can figure out an approximate annual interest rate from that.

Doing it this way is not my first, second, or third choice. I truly expect that you'll find someone or someplace that can tell you the interest rate.

But, if all else fails, you can get an answer this way.
I don’t think this is necessary. Fidelity HAS to report past performance data, so just look at that.
exodusNH
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Re: Where to get info on stable value fund

Post by exodusNH »

Optimistic wrote: Mon Sep 13, 2021 2:52 pm Thanks for the help. I'll answer some of the responses below.
Contact Prudential
I contacted Prudential (just now). They tried to look up my SSN to find my account. I haven't contributed anything to the stable value fund, so I don't have an account with Prudential. Even if I had contributed to the Prudential stable value fund within my 401k (again administered by Fidelity), I would not expect to have an account with Prudential attached via my SSN. They were not able to provide me with any information.
Write a letter to the CEO of your company to politely share that you are frustrated that you can't find the referred to rate and don't know if you should invest in this fund or not. Tell him you are a new employee and want to take best advantage of the benefits offered by the company.
This is a relatively large, publicly traded company. I would not feel comfortable writing a letter to the CEO.
Is there a website that you can log into for the 401k plan? If so, there might be some link like “ezplore my options”. If you click through on the stable value link, and on every sub-link below that, you might find the rate.
The Fidelity website is where I can log in to my 401k plan. The only information available there is what I quoted in my first post (along with a couple of graphs charting the historic return of the fund).
Can you ask your direct manager about this? He/she might have the stable value option in the plan. Alternatively, they might know a more productive way to get the answer out of HR.
My former employer was acquired by my new employer, which is why I'm a new employee. My manager (she's been my manager for 10+ years) is a new employee at this employer as well. So she wouldn't have any additional information.
if you look at the prudential site for your specific plan, you should have access to their prospectuses (mine is called "investment lineup"). When I click on my stable value fund it shows:
---
They change this quarterly and post it at the site. Can you find that?
I don't have access to any Prudential site that I know of. I contacted Prudential over the phone and they were not helpful.
You probably need to keep asking HR. Someone has the plan documents that describe the product.

I'm not sure how old you are or what a substantial amount of your bond allocation would be, but as I warned in a previous post, you may have limits on how much of that fund you can sell per year. It might take you 5 years to completely drain the fund. You might also have to go from that fund to stocks for 90 days before going back to bonds. If you're going to spend 5 years getting out of that fund into a bond fund as rates increase, you'd probably have been better off just going into the bond fund now.

The fund is probably paying +/-2% per year. Mine is currently paying 2.15% per year until Oct 1. Nowhere do I see the historical rates, but from memory, it has (unsurprisingly) been dropping. It will just as slowly increase, lagging bond funds.

If you post your complete fund line up, we can help you choose a good bond fund.
tonyclifton
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Re: Where to get info on stable value fund

Post by tonyclifton »

exodusNH wrote: Mon Sep 13, 2021 2:48 pm
It's really difficult to find. In mine, which is a Great West product, it's a completely separate section in the Empower portal. The official "fund" documentation has no reference to it. The rate resets quarterly.
I was just looking at this when this thread came up...Empower changed their fund options in April 2021. The "Guaranteed Interest Fund" was dropped and replaced by the "GWI Fixed Account - Series Class III."

Maybe not a coincidence that the word "guaranteed" was removed from the name :)

For the Empower GWI Fixed Account - Series Class III, the investment performance page (where all the fund's actual performance is listed) within the 401k portal shows 1.4% return.

The footnote says "This fixed fund is offered through a group fixed and variable deferred annuity contract issued by Great-West Life & Annuity Insurance Company. A ticker symbol is not available for this investment option."
Last edited by tonyclifton on Mon Sep 13, 2021 4:00 pm, edited 1 time in total.
tashnewbie
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Re: Where to get info on stable value fund

Post by tashnewbie »

Horton wrote: Mon Sep 13, 2021 3:44 pm
Stinky wrote: Mon Sep 13, 2021 3:42 pm
If all else fails, put some reasonable amount (say $1,000) into the Stable Value option as close to October 1, 2021 as you can. Then see what the value of your investment is on December 31, 2021. You can figure out an approximate annual interest rate from that.

Doing it this way is not my first, second, or third choice. I truly expect that you'll find someone or someplace that can tell you the interest rate.

But, if all else fails, you can get an answer this way.
I don’t think this is necessary. Fidelity HAS to report past performance data, so just look at that.
My 401k administrator (Principal) has no past performance information for the Prudential Guaranteed Income Fund that's in my 401k. I had to do a Google search to find a Q1 2021 fund fact sheet that had the quarter's return, and that return matches the fund in my 401k. Definitely not the best way to handle this, but I, like OP, don't seem to have another option.
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Horton
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Re: Where to get info on stable value fund

Post by Horton »

tashnewbie wrote: Mon Sep 13, 2021 3:59 pm My 401k administrator (Principal) has no past performance information for the Prudential Guaranteed Income Fund that's in my 401k. I had to do a Google search to find a Q1 2021 fund fact sheet that had the quarter's return, and that return matches the fund in my 401k. Definitely not the best way to handle this, but I, like OP, don't seem to have another option.
How does your plan comply with the following DOL rule?

https://www.dol.gov/sites/dolgov/files/ ... penses.pdf
Participants must be provided specific information about historical investment performance. 1-, 5- and 10-year returns must be provided for investment options, such as mutual funds, that do not have fixed rates of return. For investment options that have a fixed or stated rate of return, the annual rate of return and the term of the investment must be disclosed.
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Re: Where to get info on stable value fund

Post by Dottie57 »

I had a hard time finding the operator of the Stable Value fund. It is buried under Strategy section of the fund description.

Strategy
The Stable Value Fund, managed by Galliard Capital Management, will be primarily comprised of investment contracts issued by financial institutions and other eligible stable value investments. All contract issuers and securities utilized in the portfolio are rated investment grade by one of the Nationally Recognized Statistical Rating Organizations at time of purchase. The types of investment contracts in which the Fund invests include Guaranteed Investment Contracts (GICs), Separate Account GICs, and Security Backed Investment Contracts. These types of contracts seek to provide participants with safety of principal and accrued interest as well as a stable crediting rate.
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Optimistic
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Re: Where to get info on stable value fund

Post by Optimistic »

exodusNH wrote: Mon Sep 13, 2021 3:56 pm You probably need to keep asking HR. Someone has the plan documents that describe the product.

I'm not sure how old you are or what a substantial amount of your bond allocation would be, but as I warned in a previous post, you may have limits on how much of that fund you can sell per year. It might take you 5 years to completely drain the fund. You might also have to go from that fund to stocks for 90 days before going back to bonds. If you're going to spend 5 years getting out of that fund into a bond fund as rates increase, you'd probably have been better off just going into the bond fund now.

The fund is probably paying +/-2% per year. Mine is currently paying 2.15% per year until Oct 1. Nowhere do I see the historical rates, but from memory, it has (unsurprisingly) been dropping. It will just as slowly increase, lagging bond funds.

If you post your complete fund line up, we can help you choose a good bond fund.
I'm in my mid-40s and have a roughly 20% bond allocation in IRAs at Fidelity and Vanguard (a mix of Total US Bond Index and Total International Bond Index). I have $0 in this new 401k at the moment. But most of my new contributions will be to this new 401k which has the following for bond-ish choices:
  • PIM ALL ASSET INST (PAAIX)
  • PRUDENTIAL INCOME (Stable Value)
  • BAIRD CORE PLUS INST (BCOIX)
  • FID GOVT MMKT (SPAXX)
Fidelity does list the following restrictions on the stable value fund:
You are not permitted to make a direct exchange from Prudential Fixed Income Fund to Fidelity® Government Money Market Fund (which are considered "Competing Funds"). Before exchanging between these funds, you must first exchange to a non-competing fund for 90 days. These requirements are typically imposed by issuers such as insurance companies, banks or other approved financial institutions as a condition for issuing investment contracts to retirement plans.
If the interest rate is around 2%, then I feel comfortable putting 10% of my contributions into it and 10% of my contributions into BCOIX.

I plan to ask HR about it again tomorrow.
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Optimistic
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Re: Where to get info on stable value fund

Post by Optimistic »

Horton wrote: Mon Sep 13, 2021 3:44 pm
Stinky wrote: Mon Sep 13, 2021 3:42 pm
If all else fails, put some reasonable amount (say $1,000) into the Stable Value option as close to October 1, 2021 as you can. Then see what the value of your investment is on December 31, 2021. You can figure out an approximate annual interest rate from that.

Doing it this way is not my first, second, or third choice. I truly expect that you'll find someone or someplace that can tell you the interest rate.

But, if all else fails, you can get an answer this way.
I don’t think this is necessary. Fidelity HAS to report past performance data, so just look at that.
I can see the following from Fidelity for Average Annual Returns:
YTD (Daily)* +1.88% 1 Yr +2.88%3 Yrs +3.14%5 Yrs +3.17%10 Yrs +3.34%
And I could monitor the interest credited to my account to find out what the fund is approximately paying at the moment. But I really want to know what the guaranteed interest rate is for the next quarter (for example). If it's currently paying 2% but will be 0% for Q4, then I don't want to use it.
exodusNH
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Re: Where to get info on stable value fund

Post by exodusNH »

tonyclifton wrote: Mon Sep 13, 2021 3:57 pm
exodusNH wrote: Mon Sep 13, 2021 2:48 pm
It's really difficult to find. In mine, which is a Great West product, it's a completely separate section in the Empower portal. The official "fund" documentation has no reference to it. The rate resets quarterly.
I was just looking at this when this thread came up...Empower changed their fund options in April 2021. The "Guaranteed Interest Fund" was dropped and replaced by the "GWI Fixed Account - Series Class III."

Maybe not a coincidence that the word "guaranteed" was removed from the name :)

For the Empower GWI Fixed Account - Series Class III, the investment performance page (where all the fund's actual performance is listed) within the 401k portal shows 1.4% return.

The footnote says "This fixed fund is offered through a group fixed and variable deferred annuity contract issued by Great-West Life & Annuity Insurance Company. A ticker symbol is not available for this investment option."
My company has the Class VI fund, which is offering 2.15% through 30-Sep. (I'm pretty sure it's been 2.15% throughout 2021.) Fund documentation does mention contractually-guaranteed returns. Not sure why the name might have changed, but perhaps it's because they're now offering different funds depending on how big your plan is.
mggray17
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Re: Where to get info on stable value fund

Post by mggray17 »

For reference my Prudential SVF is:

The New Jersey DCP Stable Value Fund (GA-XXXX) crediting rate is 1.64%, effective 07/01/2021 through 09/30/2021.

The rate is updated quarterly in a message in my account. But my NJ 457 Plan is administered by Prudential, so I have an account with them.
exodusNH
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Re: Where to get info on stable value fund

Post by exodusNH »

Optimistic wrote: Mon Sep 13, 2021 4:25 pm
exodusNH wrote: Mon Sep 13, 2021 3:56 pm You probably need to keep asking HR. Someone has the plan documents that describe the product.

I'm not sure how old you are or what a substantial amount of your bond allocation would be, but as I warned in a previous post, you may have limits on how much of that fund you can sell per year. It might take you 5 years to completely drain the fund. You might also have to go from that fund to stocks for 90 days before going back to bonds. If you're going to spend 5 years getting out of that fund into a bond fund as rates increase, you'd probably have been better off just going into the bond fund now.

The fund is probably paying +/-2% per year. Mine is currently paying 2.15% per year until Oct 1. Nowhere do I see the historical rates, but from memory, it has (unsurprisingly) been dropping. It will just as slowly increase, lagging bond funds.

If you post your complete fund line up, we can help you choose a good bond fund.
I'm in my mid-40s and have a roughly 20% bond allocation in IRAs at Fidelity and Vanguard (a mix of Total US Bond Index and Total International Bond Index). I have $0 in this new 401k at the moment. But most of my new contributions will be to this new 401k which has the following for bond-ish choices:
  • PIM ALL ASSET INST (PAAIX)
  • PRUDENTIAL INCOME (Stable Value)
  • BAIRD CORE PLUS INST (BCOIX)
  • FID GOVT MMKT (SPAXX)
Fidelity does list the following restrictions on the stable value fund:
You are not permitted to make a direct exchange from Prudential Fixed Income Fund to Fidelity® Government Money Market Fund (which are considered "Competing Funds"). Before exchanging between these funds, you must first exchange to a non-competing fund for 90 days. These requirements are typically imposed by issuers such as insurance companies, banks or other approved financial institutions as a condition for issuing investment contracts to retirement plans.
If the interest rate is around 2%, then I feel comfortable putting 10% of my contributions into it and 10% of my contributions into BCOIX.

I plan to ask HR about it again tomorrow.
I'm around your age and have the same 80/20. BCOIX is what I'd use, too.

My stable value has been 2.15% all year. Given that you're at a large firm, it probably safe to assume it's going to be around 2%. It sounds like you're talking about putting new money into it instead of rolling in past money. I think that's a fine plan. Given this is new money, you're not going to be contributing all that much (in the scheme of your investing history and future) before you find out what it winds up being. You won't move the needle much no matter what you do.

If that fund is like mine, whatever money you put in gets the current rate for 12 months, then resets to the prevailing rate.
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Optimistic
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Re: Where to get info on stable value fund

Post by Optimistic »

exodusNH wrote: Mon Sep 13, 2021 4:47 pm I'm around your age and have the same 80/20. BCOIX is what I'd use, too.

My stable value has been 2.15% all year. Given that you're at a large firm, it probably safe to assume it's going to be around 2%. It sounds like you're talking about putting new money into it instead of rolling in past money. I think that's a fine plan. Given this is new money, you're not going to be contributing all that much (in the scheme of your investing history and future) before you find out what it winds up being. You won't move the needle much no matter what you do.

If that fund is like mine, whatever money you put in gets the current rate for 12 months, then resets to the prevailing rate.
Yes. I rolled funds from my previous employer to an IRA, so this 401k will only be for new money. I appreciate all the help and will let you know what HR says when they get back to me (for the 4th time).
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Svensk Anga
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Re: Where to get info on stable value fund

Post by Svensk Anga »

For reference, my stable value fund, the Vanguard Retirement Savings Trust III, paid at a 1.36% rate last month, just barely better than Total Bond's SEC yield. This one changes monthly in response to market movements and the expiration and initiation of the underlying contracts. If yours is paying more for this year, it is likely because the asset value backing the fund is shrinking in order to support the yield. If so, look for a very poor rate on the next reset, in order to allow the asset value to recover.

You can get a peek at the details of my SVF on Vanguard's institutional website here: https://institutional.vanguard.com/inve ... /fund/0340

Under the performance and price tag in the section "Portfolio Comments", they note that the ratio of market value to book value ended the quarter at 102.52%. Sure the value is stable at $1.00 as the individual sees it. The institutions backing the contracts are 2.52% ahead. Some of this market value premium should come back to investors in the form of higher than market yield over the coming months, but it can work the other way in order to keep the backing institutions whole should market value slip. I also note that the fund duration is 3.22 years. I would guess that the yield potential is that of corporate bonds of this duration less the expense ratio.

Before I found the Vanguard institutional web page for my fund, I did a monthly yield calculation based on my balance and the interest credited. It came out fairly close to the site reported yield.
dalbright
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Re: Where to get info on stable value fund

Post by dalbright »

My 401k got moved to prudential (from Fidelity) and the fund selection is fine, but the prospectus's, website, finding useful information, etc is abysmal at best (and calling in is even worse). I'm invested in fidelity funds and a prudential stable value fund there. FWIW the fund I am in has a floor/minimum guaranteed rate of 1.5% and is currently paying 1.65%. Hope this helps give you some baseline to work from as your's may be similar. Best of luck beyond that!
MrJedi
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Re: Where to get info on stable value fund

Post by MrJedi »

On one of my 401ks through Fidelity, the rate is not in the fund description/summary where you would look up basic info about funds, like composition etc. It is buried in the supplemental documents as a footnote when I go to fund performance documents. Like nearby the plan documents, brochures, etc. Very odd location.
tashnewbie
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Re: Where to get info on stable value fund

Post by tashnewbie »

Horton wrote: Mon Sep 13, 2021 4:06 pm
tashnewbie wrote: Mon Sep 13, 2021 3:59 pm My 401k administrator (Principal) has no past performance information for the Prudential Guaranteed Income Fund that's in my 401k. I had to do a Google search to find a Q1 2021 fund fact sheet that had the quarter's return, and that return matches the fund in my 401k. Definitely not the best way to handle this, but I, like OP, don't seem to have another option.
How does your plan comply with the following DOL rule?

https://www.dol.gov/sites/dolgov/files/ ... penses.pdf
Participants must be provided specific information about historical investment performance. 1-, 5- and 10-year returns must be provided for investment options, such as mutual funds, that do not have fixed rates of return. For investment options that have a fixed or stated rate of return, the annual rate of return and the term of the investment must be disclosed.
Good question. No clue. I'm going to follow up to see where they are with the investigation of this issue.
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Optimistic
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Re: Where to get info on stable value fund

Post by Optimistic »

MrJedi wrote: Mon Sep 13, 2021 8:47 pm On one of my 401ks through Fidelity, the rate is not in the fund description/summary where you would look up basic info about funds, like composition etc. It is buried in the supplemental documents as a footnote when I go to fund performance documents. Like nearby the plan documents, brochures, etc. Very odd location.
Thanks for posting this. I went and looked on the Fidelity 401k website in the Plan Information section. I reviewed all the documents available to me. In the Summary Plan Description document it states the following:
ERISA Section 404(c)
The Plan is intended to be a “participant-directed” plan as described in Section 404(c) of the
Employee Retirement Income Security Act of 1974 (“ERISA”) and the regulations thereunder.
You have the right under the Plan to direct the Plan Administrator to investment your account in
the investment funds. Because you control how your account is invested, the Plan fiduciaries
(e.g., the Plan Administrator and the Trustee) will have no responsibility for any loss in your
account resulting from investment directions given by you or your beneficiary.
You can request the following information concerning the investment funds online at
www.401k.com or by calling 1-800-835-5095:
• A description of the annual operating expenses (e.g., investment management fees,
administrative fees, transaction costs) that reduce the rate of return to participants and
beneficiaries, and the aggregate amount of such expenses expressed as a percentage of
average net assets of the investment option.
• A copy of any prospectuses, financial statements and reports, and of any other materials
relating to the investment option, to the extent such information has been provided to the
Plan.
• A list of the assets comprising the portfolio of each investment option, and with respect to
each such asset which is a fixed rate investment contract issued by a bank, savings and
loan association or insurance company, the name of the issuer of the contract, the term of
the contract and the rate of return on the contract.
(emphasis mine)
• Information concerning the value of shares or units in the investment option, as well as
the past and current investment performance of such option, determined, net of expenses,
on a reasonable and consistent basis.
The third bullet (which I bolded) says I should be able to get the rate and term of the stable value fund by calling Fidelity. So I called them, pushed the issue, and specifically referenced the section of the Summary Plan Description quoted above. The CSR spent a lot of time looking and speaking to people "in the back office" but was still unable to find the information. He said he would put in a work item to request communication from the Plan Sponsor, and I should hear back within 4 days. This gives me at least a little hope.
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retired@50
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Re: Where to get info on stable value fund

Post by retired@50 »

Optimistic wrote: Tue Sep 14, 2021 11:18 am This gives me at least a little hope.
Hopefully, the Fidelity CSR wasn't annoyed that you were making them do their job.
Demanding what they are required to provide shouldn't be a burden.

Regards,
This is one person's opinion. Nothing more.
Beehave
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Re: Where to get info on stable value fund

Post by Beehave »

retired@50 wrote: Tue Sep 14, 2021 1:57 pm
Optimistic wrote: Tue Sep 14, 2021 11:18 am This gives me at least a little hope.
Hopefully, the Fidelity CSR wasn't annoyed that you were making them do their job.
Demanding what they are required to provide shouldn't be a burden.
Regards,
Just before the sub-prime fiasco actually hit, there was enough buzz that I was aware enough to call Fidelity about the stable fund fund in a family member's 401k administered by Fidelity. I asked the CSR if there were sub-prime mortgages as fund assets. They obfuscated, kept asking me to move my own non-Fidelity funds into Fidelity (i.e., wanting to drumup business and change the subject), and finally indirectly led me to believe the fund held no sub-prime assets.

Then, next reporting period after sub-prime hit the fan, Fidelity sent a quarterly fund report saying it under-performed because of the sub-prime mortgage content components of the fund. A contemporaneous report from Vanguard said its Prime Money fund had outperformed because they held no sub-prime stuff.

Two points:

(1) The interest rate of the stable value fund is not all that matters. Its contents do too.

(2) Customer service includes both the quality of the product and the quality of the customer interface. Before that episode with Fidelity I had a sort of comparable type of experience when contacting Vanguard to ask its annuity sales rep if buying an annuity made sense for me at that time. After discussing my situation, and based on my circumstances she explained why she advised against buying her product.

In my experience there's an inherent difference between a customer-owned enterprise and a for profit one when it comes to customer service both in product and experience with csrs when it has really mattered.
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