Great 403b for teachers?

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krow36
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Re: Great 403b for teachers?

Post by krow36 » Fri Apr 21, 2017 1:18 am

You probably know that there is a 403b reform movement that has been active for decades. Both Dan Otter, who started and runs 403bwise.com, and Scott Dauenhauer, CPA, who blogs at http://teachersadvocate.blogspot.com are truly 403b Reform Warriors! Scott wrote “The Wild West, Providing Fiduciary Advice to Public School Employees”. Steve Schullo is a frequent poster on both the BH and 403bwise forums, and is contributing to this thread. He has spent years working to improve the LAUSD 403b and helped organize and is a committee member of an award winning 457 plan. He describes the whole saga in his book “Fighting Powerful Interests”.

Podcast #13 describes a MD county school district that went through the steps to change from using a list of providers, to a single provider, Fidelity. The county wide school district was able to assume a true fiduciary responsibility for their 403b plan. It was a very impressive and challenging undertaking, as Fidelity has to deal with all the many legacy vendors. Many of the podcasts cover a wide variety of efforts to improve the K-12 403b. http://teachandretirerich.com/podcasts/

W Scott Simon is an ERISA lawyer and writes a monthly article for Morningstar. He wrote 3 articles interviewing Steve which are very interesting (May, Jun, Jul 2015). He also wrote a long series in 2007, one article in 2008 and two in 2015 before the three with Steve. In the June 2015 article, they discuss the “open vendor” state law that prevents school districts from putting out bids for a plan and selecting a single vendor. I believe CA and WA have these laws as well as other states, but I don’t know about FL. http://www.morningstar.com/advisor/arch ... cott+Simon M* requires registration to access the articles but it’s free.

I wouldn’t be surprised if you were well-versed in all the above but I thought it was worth posting in case there are others interested in digging a bit deeper into the K-12 403b world.

EdLaFave
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Re: Great 403b for teachers?

Post by EdLaFave » Fri Apr 21, 2017 7:03 pm

Thank you for sharing and don't hesitate to share more.

I had no idea my wife's 403b/457b was going to be a nightmare until I was in the middle of it. I had no idea that 403b/457b plans are generally a nightmare across the nation. I had no idea there was a movement. I'm just a guy who became outraged when I learned that paying our most important profession like crap wasn't enough, "they" also had to steal from their retirement accounts!

Orange County Public Schools (FL) is renegotiating their contracts Jan 2018 and they won't be doing it again for another 5 years. I'm trying to work the school board, union, and OCPS retirement services all at once. I'm going to try to organize employees as well. I'm reading Steve's book. I fear I'll make some big mistakes because I don't have enough time to learn all the lessons that seem to be available from those who came before me...just not enough time before Jan 2018. I suspect I'll fail but you never know.

krow36
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Re: Great 403b for teachers?

Post by krow36 » Sat Apr 22, 2017 2:11 pm

EdLaFave wrote:Orange County Public Schools (FL) is renegotiating their contracts Jan 2018 and they won't be doing it again for another 5 years.

"Renegotiating their contracts" sounds unusual for a K-12 school district. A 401K plan or a rarely seen ERISA 403b plan are plans established by the employer for the benefit of the employees. The employer has a fiduciary responsibility and the plan administrators hired by the employer also have a fiduciary responsibility.

In contrast, the usual K-12 403b plan is an arrangement between the employee and the vendor. The employee can choose any vendor on the employer's list. I believe the district can restrict the number of providers unless the state has an "open vendor" law. The employer doesn’t vet any of the provider’s several offerings.

I wonder if Orange County Public Schools is not a typical K-12 school district, and has attempted to take on some fiduciary responsibility for their employees’ 403b/457 plans? Whatever plan they have, you should be able to get a copy of it. If they did hire a fiduciary to set up their 403b/457 plans, they ended up with 10 providers that are the usual insurance companies that sell mostly high-fee annuity based plans. Most also sell high-fee mutual fund-based 403b/457 plans. I think Plan Member is the only non-insurance company. TIAA doesn't deserve to be lumped in with the other insurance companies.

American Century Services / 800-345-3533

AXA Advisors / 800-628-6673

Great American / 800-789-6771

Reliastar (VOYA) / 877-884-5050

LSW / 800-579-2878

Plan Member Services / 800-874-6910

Security Benefit Group / 800-888-2461

TIAA - CREF/ Enrollment/ 800-842-2888

TIAA - CREF / Existing Clients/ 800-842-2776

VALIC / 800-448-2542

I notice that in 2013 they asked for bids on a 401a/403b Special Pay Plan, FICA Alternative Program and Recordkeeping Administration. “Special Pay Plan to be used to deposit accumulated sick and/or vacation leave, terminal retirement pay, or other incentive payments on behalf of all eligible employees.” https://www.ocps.net/op/procure/Solicit ... ration.pdf
I wonder what this plan looks like?
I'm trying to work the school board, union, and OCPS retirement services all at once. I'm going to try to organize employees as well. I'm reading Steve's book. I fear I'll make some big mistakes because I don't have enough time to learn all the lessons that seem to be available from those who came before me...just not enough time before Jan 2018. I suspect I'll fail but you never know.

I think you should be optimistic that your efforts will have a positive effect on the new plan. If you successfully push for a single provider that provides on-site education, there will be fees, either higher ERs and/or annual flat fees to cover that expense. Unlike a 401k where a company frequently picks up the cost of administering the fund, the school district rarely can afford to subsidize their 403b plan. Perhaps Fidelity would be willing to repeat in FL's Orange County SD what they did in the MD county? Have you listened to the podcast? Of course just getting Fidelity added to the provider list would be a great improvement. The employee education could be a separate project?

EdLaFave
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Re: Great 403b for teachers?

Post by EdLaFave » Tue Apr 25, 2017 5:47 pm

As far as I know OCPS (FL) is in the second category where they select a few vendors and force their employees to go through one of those vendors. Although I don't know the exact mechanics of the relationship. If OCPS or the TSA Consulting Group they're using are acting as a fiduciary then they're doing a terrible job.

I believe by "renegotiate" she meant that they could add/remove vendors every 5 years and perhaps make certain demands of the vendors.

I'm not pushing for a provider to be on site educating people (quite the opposite actually). In my ideal world, I'd want a single provider (not 10) that offers at most Total Stock, Total International Stock, Total Bond, target date, and fixed allocation funds with ERs <= 0.11%. It would be easy for the 5 person staff of OCPS Retirement Services to understand and provide appropriate guidance and advice to employees.

After reading that Steve had a multi-decade struggle it is tough to be optimistic although that doesn't affect my actions or mood. Just controlling what I can control but it sure would feel great to be successful.

Can you expand on the district's relationship to the cost of administering a 403(b)/457(b) plan? Perhaps I'm naive in thinking they could bring in somebody like Vanguard/Fidelity and the costs would be minimal...after all, we're currently invested in NEA DirectInvest with rock bottom fees.

I haven't had time to listen to the podcast or read most of the links...not enough hours in the day it seems.

krow36
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Re: Great 403b for teachers?

Post by krow36 » Wed Apr 26, 2017 12:31 am

EdLaFave wrote:As far as I know OCPS (FL) is in the second category where they select a few vendors and force their employees to go through one of those vendors. Although I don't know the exact mechanics of the relationship. If OCPS or the TSA Consulting Group they're using are acting as a fiduciary then they're doing a terrible job.
OK, this is the same arrangement that the vast major of K-12 public schools are under.

I believe by "renegotiate" she meant that they could add/remove vendors every 5 years and perhaps make certain demands of the vendors.
This probably varies district to district. Districts are now required by the IRS to have a written plan. It should be on the internet but I think it usually is not. The 403b regulations it’s a relationship between the employee and the provider—the employer isn’t responsible for advice or guidance. I read that OCPS is number 10 in the nation for size, and it seems unusual to me that there are just 10 providers 9 of which are insurance companies. Remember about 70% of teachers don’t use a 403b. Of the 30% that do, most are in annuities. Maybe 5% are in mutual fund based 403b plans.

I'm not pushing for a provider to be on site educating people (quite the opposite actually). In my ideal world, I'd want a single provider (not 10) that offers at most Total Stock, Total International Stock, Total Bond, target date, and fixed allocation funds with ERs <= 0.11%. It would be easy for the 5 person staff of OCPS Retirement Services to understand and provide appropriate guidance and advice to employees.
I agree that would be ideal. Of course the insurance industry would fight such a proposal tooth and nail. Do you know how the OCPS Retirement Services staff are funded? Considering that the district uses a TPA, what do they do all day? And some teachers would oppose it because they’ve trust that nice rep!?

After reading that Steve had a multi-decade struggle it is tough to be optimistic although that doesn't affect my actions or mood. Just controlling what I can control but it sure would feel great to be successful.

Can you expand on the district's relationship to the cost of administering a 403(b)/457(b) plan? Perhaps I'm naive in thinking they could bring in somebody like Vanguard/Fidelity and the costs would be minimal...after all, we're currently invested in NEA DirectInvest with rock bottom fees.
The K-12 403b plans of Vanguard and Fidelity are generic plans—the same plan in every state. They are administered over the internet and phone. They don’t provide any on-site guidance or advice. So the costs are minimal for them to be on the provider list. I’ve read that there’s a small fee of maybe $30 per enrollee that the TPA requires be payed. The insurance companies willingly pay the fee. Fidelity seems willing to pay this fee more often than Vanguard. The district size may be a factor, I don’t know. Probably Fidelity relies on their managed, profitable funds to pay the costs administration.

I haven't had time to listen to the podcast or read most of the links...not enough hours in the day it seems.

EdLaFave
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Re: Great 403b for teachers?

Post by EdLaFave » Wed Apr 26, 2017 6:31 pm

krow36 wrote:I read that OCPS is number 10 in the nation for size, and it seems unusual to me that there are just 10 providers 9 of which are insurance companies.


Apparently in 2013 they removed vendors.

krow36 wrote:Of course the insurance industry would fight such a proposal tooth and nail. Do you know how the OCPS Retirement Services staff are funded? Considering that the district uses a TPA, what do they do all day? And some teachers would oppose it because they’ve trust that nice rep!?


I have no idea how they're funded. I assumed they were funded the same way any teacher or administrator is. The fact that you asked that questions makes me think I need to be educated.

...finally got a chance to listen to a few of those podcasts, it is nice that people are out there doing something.

krow36
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Re: Great 403b for teachers?

Post by krow36 » Thu Apr 27, 2017 2:07 am

EdLaFave wrote:Apparently in 2013 they removed vendors.

Assuming they removed annuity vendors, I guess they deserve credit for that. Then again they might have removed a low-cost vendor?
I have no idea how they're funded. I assumed they were funded the same way any teacher or administrator is. The fact that you asked that questions makes me think I need to be educated.

There’s a LOT of 403b money being made in a district the size of OCSD. There have been cases where the TPA boss was actually an insurance agent, selling his plans. A district’s HR office can have a relative in the 403b annuity business. It’s something to keep in mind. Have you read the recent NY Times articles on the K-12 403b? https://www.nytimes.com/2016/10/23/your ... share&_r=0
...finally got a chance to listen to a few of those podcasts, it is nice that people are out there doing something.

Podcast #26 at 00:21:40 talks about NEA and Security Benefit and a bit about Direct Invest. Speaking of 403b money, SB pays NEA something like 2.5M a year to have exclusive rights to add “NEA” to several of the SB 403b high fee products! That gives you an idea of how profitable annuity based 403b plans are.

EdLaFave
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Re: Great 403b for teachers?

Post by EdLaFave » Sun Apr 30, 2017 7:06 am

I'll give that article a read soon. Corruption wouldn't surprise me simply because so much money is involved but so far I have no reason to believe it is anything beyond ignorance, not caring, and wanting to offload "work" on to third party companies.

It is interesting to read so many negative takes on NEA but at the end of the day their name is on the only good 403b I have access to. I'll have to read more on their history.

...also, I wrote a web site to publicize and advocate for this cause. Any feedback is appreciated educatorsfightingforfairness.wordpress.com

krow36
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Re: Great 403b for teachers?

Post by krow36 » Sun Apr 30, 2017 3:04 pm

EdLaFave wrote:I'll give that article a read soon. Corruption wouldn't surprise me simply because so much money is involved but so far I have no reason to believe it is anything beyond ignorance, not caring, and wanting to offload "work" on to third party companies.

I hope you're right.
It is interesting to read so many negative takes on NEA but at the end of the day their name is on the only good 403b I have access to. I'll have to read more on their history.

Direct Invest only exists because Security Benefit sells millions worth of high-fee annuity based 403b NEA labelled plans to teachers.
...also, I wrote a web site to publicize and advocate for this cause. Any feedback is appreciated educatorsfightingforfairness.wordpress.com

You've done a great job! Very impressive. How are you getting out the word that your web site exists?

EdLaFave
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Re: Great 403b for teachers?

Post by EdLaFave » Sun Apr 30, 2017 5:31 pm

krow36 wrote:You've done a great job! Very impressive. How are you getting out the word that your web site exists?


Thank you.

I am open to all suggestions on getting the word out.

I'm trying to get the Orlando Sentinel interested in writing a story. If you type the right phrases in google we are on page 1, so I am trying to further optimize that. My wife and I have posted about it on Facebook so a few OCPS employees have found it that way. Any time we talk to somebody we mention it. We need a better approach though.

sschullo
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Re: Great 403b for teachers?

Post by sschullo » Sun Apr 30, 2017 8:35 pm

EdLaFave wrote:
krow36 wrote:You've done a great job! Very impressive. How are you getting out the word that your web site exists?


Thank you.

I am open to all suggestions on getting the word out.

I'm trying to get the Orlando Sentinel interested in writing a story. If you type the right phrases in google we are on page 1, so I am trying to further optimize that. My wife and I have posted about it on Facebook so a few OCPS employees have found it that way. Any time we talk to somebody we mention it. We need a better approach though.


Hi Ed,
Below are addition ways to "get the word out." These additional websites were started and maintained by educators or retired educators and three super friendly CFPs who fight the monopolistic environment of the insurance industry on the public k-12 403b plan with districts nor the unions protecting their members or employees:

#1 – Dan Otter is a teacher and LONG time crusader for better 403(b) plans and increased education among teachers about 403(b)’s. Dan has either been through or heard it all when it comes to 403(b) issues. As is the case with most teachers Dan was approached in his classroom early in his career by an insurance salesman pitching an expensive and inappropriate annuity-based retirement plan. Dan has a book and podcast on the topic of 403(b) and manages the forums at his website http://www.403bWise.com where teachers share and discuss their experiences with 403(b) retirement plans. The media frequently cites him for his experience and knowledge about teacher retirements.

#2 – Andrew Hallam writes at http://www.AndrewHallam.com and is a former teacher and long-time student of investing. Andrew amassed over $1 million before the age of 40 and wrote a book about it. He continues to write about investing and retirement at his website.

#3 – Steve Schullo is the webmaster of this website http://www.latebloomerwealth.com, the author of two books and a retired Los Angeles Unified School District teacher who writes at LateBloomerWealth. Steve is frequently cited by media outlets for his experience and wisdom about the 403(b) situation facing teachers (high fees, low returns) and continues to be a staunch supporter of a better system for teacher retirement systems. Books: Late Bloomer Millionaire and Fighting Powerful Interests: Educators Challenge Tax-sheltered Annuities and WIN! (free pdf download from Steve’s blog).
Below are my latest quotes in Kiplinger and the massively comprehensive 403(b) report in the New York Times 5 Part series:
Kiplinger Magazine http://www.kiplinger.com/article/retirement/T047-C000-S002-how-to-save-if-you-do-not-have-a-401-k.html (January 2017).

2. New York Times (October 2016-November 2016):https://www.nytimes.com/2016/10/29/your-money/403b-teachers-annuities.html?_r=0 Note: The NY Times published a series of five articles on the 403(b) with public k-12 school districts, not just the one I was quoted in the link here. Read them all. Links are below. You and your colleagues will understand and protect yourself from the hideous over-the-top aggressive sales pitch from annuity agents who have state insurance laws protecting them at the expensive of naive’ teachers. The series ran from October 21, 2016 through November 5, 2016.

NY Times 403(b) Part 1: https://www.nytimes.com/2016/10/23/your-money/403-b-retirement-plans-fees-teachers.html?action=click&contentCollection=Your%20Money&module=RelatedCoverage&region=EndOfArticle&pgtype=article

NY Times 403(b) Part 2: https://www.nytimes.com/2016/10/27/your-money/403-b-retirement-plans-teachers-brokers-fees.html?module=Promotron&region=Body&action=click&pgtype=article

NY Times 403(b) Part 3: https://www.nytimes.com/2016/10/29/your-money/403b-teachers-annuities.html

NY Times 403(b) Part 4: https://www.nytimes.com/2016/11/03/your-money/spreading-the-gospel-of-better-retirement-plans.html

NY Times 403(b) Part 5:[url] https://www.nytimes.com/2016/11/05/your ... -tips.html
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#4 – Ed Mills is known as the “Millionaire Educator” and writes at writes at http://www.MillionaireEducator.com. Ed and his wife have amassed nearly $1 million at the time of this post…on a teacher’s salary. Ed and his wife have used an amazing technique for saving and investing as well as taught overseas for a few years to amass enough money that they could put a huge portion of their salaries directly into their retirement accounts. They now regularly transfer school districts to roll their 403(b)’s into IRA’s with Vanguard (who I heartily endorse).

#5 – Tony Isola is a former teacher and Certified Financial Planner (CFP) who writes at http://www.TonyIsola.com. Tony is a fired up advocate for teachers who is heated about the 403(b) options provided to most teachers. Tony knows both teaching and investing and provides a unique voice from someone working tirelessly on your behalf.

#6 – Dave Grant is also a Certified Financial Planner (CFP) who writes at http://www.FinanceforTeachers.com Dave is married to a teacher and shares a similar story about the 403(b) market available to teachers. Dave is a speaker and author as well as a trustworthy teacher advocate. Dave is experienced in dealing with a broad range of financial options for teachers and is available to come speak at schools in the Chicagoland area.

#7 – Scott Dauenhauer is another Certified Financial Planner (CFP) who writes his blog Teachers Advocate: http://teachersadvocate.blogspot.com/ He is one of the brains that created the best 403(b) in California under the guidance of the state’s teacher pension system: Pension2. He just released his 2nd book for financial advisors who want to work with k-12 public school teachers: Wild West: Providing Fiduciary Advice to Public School Employees

I dream that when we either write a blog post or see a 403(b) related news item that all of us resend, retweet, write it up on our blogs and send it out to our followers. The more advocates we have the more teachers we can reach. We have to do these things because nobody else is.

Regards,
Steve
Public School K-12 Educators: "Ask NOT what your annuity sales person can do for you, ask what you can do to be a Do-It-Yourselfer (DIY)."

EdLaFave
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Re: Great 403b for teachers?

Post by EdLaFave » Tue May 02, 2017 8:02 pm

I poked around a few of those sites but didn't see an obvious way to publicize my site. What exactly are you suggesting?

krow36
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Re: Great 403b for teachers?

Post by krow36 » Tue May 02, 2017 11:16 pm

Is it possible for your wife to put a short notice in teacher’s boxes at school? If not, maybe pass it out hand to hand? Maybe suggesting an informal get-together on 403b investing, either at school or at a coffee shop?

The Orlando newspaper article could get the attention of teachers and spread the word on your website, which would be great. Non-teachers may not be very sympathetic. The comment sections of the NY Times articles are worth reading. As you know, most non-teacher professionals don’t have a pension, only a 401k. Teachers have a pension, and a 403b and a 457!

The high-cost annuity salesmen that are allowed to come to the worksite are one feature of the K-12 403b world that I find gets sympathy from non-teachers. I hear comments like “is that legal?”. It seems to me that we need to educate the educators, which is what your website is all about. If you emphasize spreading the word, I think progress will be made. Like passive index investing, the curve hasn’t been linear, but the compounding of teacher 403b knowledge will happen.

You’ve no doubt thought about your wife’s many colleagues who are paying into an expensive annuity based 403b plans. Maybe your website could discuss the process of moving an annuity 403b account into a low-cost mutual fund 403b (SB Direct Invest)? Or into the PlanMember Direct 457 plan? You do a great job of explaining the process of setting up a low-cost SB Direct Invest account, and that’s the first step. Maybe discuss surrender fees vs high annual fees?

How about posting on the 403bwise.com website? There are others there trying to do what you doing.

EdLaFave
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Re: Great 403b for teachers?

Post by EdLaFave » Wed May 03, 2017 5:23 am

Unfortunately my wife immediately said no and declined to say why. I assume she feels this is taboo and she isn't interested in talking to teachers when they're "busy". It seems that door is closed.

I absolutely want to discuss the process of moving an annuity. Somebody has told me they want my help to do just that during the summer and I'll document each step on the site.

I wanted to post to 403bwise but they have rules that prevent people with new accounts from creating a topic and I don't want to hijack somebody else's thread. I'd like to see that policy changed but until it is, I can't post there.

sschullo
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Re: Great 403b for teachers?

Post by sschullo » Wed May 03, 2017 10:22 am

EdLaFave wrote:I wanted to post to 403bwise but they have rules that prevent people with new accounts from creating a topic and I don't want to hijack somebody else's thread. I'd like to see that policy changed but until it is, I can't post there.


The rules of registering and posting on 403bwise are no different than here. Of course, you have to register before posting. Otherwise, the trolls, spam, nerdo wells and the ad hominem attacks would be all of this site and 403bwise.

Please post your story on 403bwise.com.
Public School K-12 Educators: "Ask NOT what your annuity sales person can do for you, ask what you can do to be a Do-It-Yourselfer (DIY)."

EdLaFave
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Re: Great 403b for teachers?

Post by EdLaFave » Wed May 03, 2017 10:43 am

I will if I'm ever able to, I've got an account named "EdLaFave". Right now the button to start a new topic says "You cannot start a new topic"

sschullo
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Re: Great 403b for teachers?

Post by sschullo » Wed May 03, 2017 12:22 pm

EdLaFave wrote:I will if I'm ever able to, I've got an account named "EdLaFave". Right now the button to start a new topic says "You cannot start a new topic"
send a note to Dan Otter.
Public School K-12 Educators: "Ask NOT what your annuity sales person can do for you, ask what you can do to be a Do-It-Yourselfer (DIY)."

krow36
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Re: Great 403b for teachers?

Post by krow36 » Thu May 04, 2017 12:28 pm

EdLaFave wrote:Unfortunately my wife immediately said no and declined to say why. I assume she feels this is taboo and she isn't interested in talking to teachers when they're "busy". It seems that door is closed.

I'm a retired teacher and I think I may understand your DW's viewpoint. Especially at the beginning of my teaching career (secondary science and math), I felt pushed to my limits, and unwilling/unable to take on any additional obligations. This level of stress lessened over the years but time (and energy) was always in short supply. My non-teaching friends said I looked exhausted by Friday. I was!

Perhaps your best course of action is to find some OCSD employees to join you with your project? With a district that size (#10 in the nation!), there must be a number of sympathetic, willing and able folks out there. It seems like you need someone on the inside that shares your reform goal and has the time and energy to work with you. As you find others to join you, you can morph into an group that has standing as a teacher organization.

Is there a standing committee for the upcoming 403b review in 2018? If so can you find out the member's names and talk to them? I think your goal of moving to a single vendor of a small number of low-cost index funds is very ambitious at this stage. That would be a huge project that would require leadership from the top and probably a district willing to spend money to hire a professional fiduciary. Ideal but perhaps too BH-ish for many OCSD teachers at this stage?

It's often noted that teachers trust the reps that flock to the schools and this results in them buying annuity based 403b plans. I see a similar situation with the general public using reps with Edward Jones, Ameriprise, various banks, etc. The public in general, not just teachers, wants to have a face-to-face with their financial organization. Using the internet to cut out the expensive middle-man is not accepted by much of the general public. However Vanguard's increasing success is getting a lot of attention. There needs to be a face to face with teachers to explain that they don't need (and shouldn’t have) a face to face with a rep who is selling commissioned 403b products, as you have mentioned in your “the district should” list.

I'm glad you finally got on the 403bwise forum!

EdLaFave
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Re: Great 403b for teachers?

Post by EdLaFave » Fri May 05, 2017 7:19 pm

krow36 wrote:I'm a retired teacher and I think I may understand your DW's viewpoint...My non-teaching friends said I looked exhausted by Friday. I was!


I agree completely. On top of that the risk/reward equation is awful; it's all risk and no reward.

krow36 wrote:Perhaps your best course of action is to find some OCSD employees to join you with your project? ... As you find others to join you, you can morph into an group that has standing as a teacher organization.


I couldn't agree more. Maybe I'm just projecting my anger associated with discovering somebody is taking more than 50% of my investment returns, but it sure seems like one heck of a motivator to get that ball rolling. If I can connect with a few more OCPS employees I can imagine this growing organically.

krow36 wrote:Is there a standing committee for the upcoming 403b review in 2018? If so can you find out the member's names and talk to them?


Apparently there is something called the "fringe committee" made up of OCPS administrators and union reps. It sounds like they haven't picked the exact people who will be on that committee but I've been speaking to at least one of the likely candidates.

krow36 wrote:I think your goal of moving to a single vendor of a small number of low-cost index funds is very ambitious at this stage. That would be a huge project that would require leadership from the top and probably a district willing to spend money to hire a professional fiduciary. Ideal but perhaps too BH-ish for many OCSD teachers at this stage?


Tell me if I'm wrong on this...I believe in laying out the ideal solution and beginning negotiations from there. I don't expect a 100% win, in reality a 0% win wouldn't be surprising either. Do you think this is a tactical mistake?

krow36 wrote:The public in general, not just teachers, wants to have a face-to-face with their financial organization. Using the internet to cut out the expensive middle-man is not accepted by much of the general public.


I'm sure this doesn't comfort people pushing for 403(b)/457(b) reform today and I'm sure I'm not breaking news here, but the youth increasingly want interactions like this to take place over the internet and are increasingly annoyed by the idea that you'd meet or call somebody for this. Who knows, maybe this will be an asset in the decades to come? Or maybe I'm misreading the general public.

krow36 wrote:There needs to be a face to face with teachers to explain that they don't need (and shouldn’t have) a face to face with a rep who is selling commissioned 403b products


I really hope to fill that role. I'd love to generate enough interest to hold some kind of workshop/meeting where people can gain the confidence to move forward on their own.

BashDash
Posts: 364
Joined: Mon Nov 28, 2016 12:31 pm

Re: Great 403b for teachers?

Post by BashDash » Fri May 05, 2017 7:40 pm

Ed I have been following your threads and I think your heart is in the right place for sure. I do think you are underestimating, as Krow36 has mentioned, that teachers are nervous or not knowledgeable enough to self direct. My district has 3 low cost options; aspire, SB direct, and the Ny 457 but I do not think anyone can handle self directing any of these. Without BH, I would have struggled too. Most teachers won't go to online forum to get help to self direct. I have even suggested target funds and still I think people don't even feel confident. To be honest, I'm not really wanting to suggest any investments in general as people need to take ownership of that on their own. Unfortunately, who better to lean on when nervous about self directing? Your friendly insurance salesmen hanging out in the library or teachers lounge with his important looking briefcase.

EdLaFave
Posts: 257
Joined: Fri Dec 26, 2014 2:31 am

Re: Great 403b for teachers?

Post by EdLaFave » Fri May 05, 2017 8:04 pm

BashDash wrote:Ed I have been following your threads and I think your heart is in the right place for sure. I do think you are underestimating, as Krow36 has mentioned, that teachers are nervous or not knowledgeable enough to self direct. My district has 3 low cost options; aspire, SB direct, and the Ny 457 but I do not think anyone can handle self directing any of these. Without BH, I would have struggled too. Most teachers won't go to online forum to get help to self direct. I have even suggested target funds and still I think people don't even feel confident. To be honest, I'm not really wanting to suggest any investments in general as people need to take ownership of that on their own. Unfortunately, who better to lean on when nervous about self directing? Your friendly insurance salesmen hanging out in the library or teachers lounge with his important looking briefcase.


Thanks for the warning. Maybe I'm a fool but I absolutely believe everybody can manage their own investments, nothing can be easier than a target date fund. Still, I know the fear of "doing it wrong" can lead to people stubbornly clinging to an "expert" (I was one of those people for years).

I'm not sure I'm underestimating this task because I actually expect it to fail at every level but maybe I should expect it to fail in epic fashion. Still I feel obligated to give it my best shot. It's hard for me to side step a trap and just silently watch the next person fall into it.

If you have any suggestions for how to approach and speak with these types of school employees, I'm 100% willing and happy to learn from your experience.

BashDash
Posts: 364
Joined: Mon Nov 28, 2016 12:31 pm

Re: Great 403b for teachers?

Post by BashDash » Fri May 05, 2017 8:19 pm

I didnt mean to be so negative. Look at some of the other 403b reformers who were up against terrible odds. Have you read Steve Schullo's book? I say to for it. I've done a few talks for my school and union talking about the costs/fees that I have to feel were successful even if it helped only a few people. I feel I am paying it forward to the BH board. Plus I like the David vs Goliath aspect of this too. Teachers could use your help why not go for it!

EdLaFave
Posts: 257
Joined: Fri Dec 26, 2014 2:31 am

Re: Great 403b for teachers?

Post by EdLaFave » Fri May 05, 2017 10:04 pm

I am in the middle of reading Steve's book. A battle measured in decades, what a Herculean effort. I'll go for it, every now and then the little guy gets lucky :)

I share your satisfaction about the possibility of only helping a few people and I've already helped one with a few more in the pipeline.

BashDash
Posts: 364
Joined: Mon Nov 28, 2016 12:31 pm

Re: Great 403b for teachers?

Post by BashDash » Sat May 06, 2017 10:44 am

For the level of confusion I was feeling look up my thread on 403b and Voya. It goes on forever but it may help you get the mindset of a confused teacher. But most teachers without BH won't have krow walking them thru it.

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