I've recieved quite a few comments from people on my recent article "Long Live the 20% Surrender Charge." Most of the comments were complimentary, but evidently I ruffled a few feathers in the insurance agent community (which is of course the point). I received e-mails from a few reps who called themselves Independent but then claimed to be senior reps with one of the companies mentioned. I don't see how you can be a "senior" rep with a company and still be independent, but that's another story.
I was accused of not presenting the whole story or just not being fair. One agent told me the product had been discontinued, another told me that he had placed 200 clients in that product (a truly scary thought and not something I'd readily admit too). None of these agents actually disputed that these products exist or existed, which is of course the point.
I recieved one e-mail that told me AVIVA now offers a product with only a 12% surrender charge.....only. If this doesn't tell you what is wrong with the 403(b) market, I don't know what will. I can't imagine a 401(k) plan with a 12% surrender penalty and a lousy interest rate, it may happen, but it isn't bragged about as in the 403(b) world.
Companies that are offering products with 10 year surrender periods and excessive surrender penalties shouldn't be allowed to offer products and their agents should be banned from school districts.
Equity Indexed Annuity
Recently I came across an industry publication that is supposed to be for "insurance agent use only" and it listed fixed annuity products along with their corresponding surrender periods, beginning surrender charges, and commission rates. What interested me the most was the commission differential between a traditional fixed rate annuity and the equity indexed annuities that seem to be so hot right now. I'll use Great American as an example since they sell 403(b) products, though keep in mind that I don't know if the products listed are available in the 403(b). What I want to demonstrate are the incentives agents have to sell one type of fixed annuity versus another.
Company Product Sur Period Sur Charge Commission
Great American American Freedom 10-ST 10 Years 9% 8%
Great American American Legend EIA 10 Years 10% 9%
Now, this is actually a pretty good differntial, there isn't that much incentive to sell an Equity Indexed Annuity over the straight fixed product, but there is still an incentive, one must ask why? Some companies have differentials of 7% or more which means an agent would get paid up to 7% more to sell an equity indexed annuity over a traditional fixed annuity, this is just wrong. I'm not picking on Great American, I'm picking on the insurance companies, agents, and marketing companies that continue to lie about the equity indexed annuity and pay higher commissions to promote them. The concept of an Equity Indexed Annuity could actually work (though not like presented by most agents) if it was done on an honest, simple, and commission reduced basis. The industry won't listen, they make way to much money on these products.
I'd love to continue to hear your thoughts and opinions on Equity Indexed Annuities and excessively high surrender charges on fixed products.
Scott Dauenhauer, CFP, MSFP
Friday, December 16, 2005
Sunday, December 11, 2005
The Perfect Storm - School Districts Beware
School Retirement Plan Editorial
It’s Time To Get Serious About 403(b)/457(b) Retirement Plans
The perfect storm is developing in the 403(b) world, only this storm has the potential to wreck serious harm on the 403(b) industry, not the employees the industry portends to serve. The outcome of this perfect storm could very well spell the beginning of the end for the current inefficient distribution method of the 403(b) retirement plan. It is time the school districts and county office of educations around the country began taking these back burner retirement plans seriously. The education community has the opportunity to take back a retirement plan that was started as an employee benefit, but has largely become a subsidy for the financial services industry.
What are the events that are precipitating this Perfect Storm?
A Movement Begins
The first event isn’t really an event, it is a movement that began in 2000 when a teacher by the name of Dan Otter started a website called www.403bwise.com that allowed a community of like minded educators to congregate in one place and speak out against 403(b) abuses in the industry and simultaneously provide unbiased education about retirement plans available to school employees. Dan eventually teamed up with myself to write “The 403(b) Wise Guide,” a manual on how to effectively utilize the 403(b) retirement plan. The book has sold over 10,000 copies and led to a second book solely authored by Dan called “Teach and Retire Rich.” These two books have had the effect of educating the educators and have started a “Great Awakening” among them about how best to save for retirement.
The IRS Issues New Regulations
The second event is the Proposed IRS regulations for the 403(b) which are scheduled to become final January 1st, 2007. These regulations are far reaching and require the employer to take control of the 403(b), whether the employer wants to or not. The new regulations require the employer to monitor all transfers, distributions, loans, and to create a plan document that governs how the plan will be run. While the employer is currently obligated to do many of these things already most don’t, but they won’t be able to get away with not complying anymore.
The new regulations are serious and will create a compliance nightmare if school districts continue to offer a long list of providers. The 403(b) industry is scared of these regulations and is fighting them. The spokes group for the 403(b) financial services industry is the National Tax Sheltered Accounts Association and they have attempted to hire a lobbyist to fight these regulations, though they couldn’t come up with the money from their members, mainly insurance agents. However, insurance companies themselves are taking the battle to congress and they are a powerful lobby. My hope is that they don’t get their way. The new regulations will be tough to comply with under the current way of operating, however they will be simple if a new way is adopted.
Intermediaries Fail
The third and most disturbing event is the series of third party administrator (TPA’s) failures over the past 18 months. These TPA’s were responsible for accepting money from school districts and forwarding it to the 403(b) vendors the educators want to invest in. The TPA’s were also responsible for keeping the plan in compliance. Horizon Benefits Administration, NEBSonline, and Plan Compliance Group have not only failed over the past 18 months but are all facing criminal investigations, lawsuits, and worst of all they (allegedly) stole money from school district employees. The latest, Plan Compliance Group has taken school districts across the country for over $3 million. School districts across the nation are sending money to TPA’s with very few checks and balances in place to prevent this theft and they are paying for this mistake out of their own pocket.
Not only are districts sending money to TPA’s who may not be financially viable they are sending money to financial services companies that don’t actually have their own products (I dub them “403(b) Intermediaries”). There are many “payroll slots” in school districts where money is sent to a financial services firm and that firm deposits the money to their own corporate accounts before sending the money onto another 403(b) vendor. These companies either don’t have a 403(b) product or their own or they offer their product alongside of others. Though this is common practice in the industry it is dangerous for three reasons.
First, the IRS clearly states in publication 571 that “Generally only your employer may make contributions to your 403(b) account” through a salary reduction agreement and “this agreement allows your employer to withhold money from your paycheck to be contributed directly into a 403(b) account for your benefit” (emphasis added). Thus the IRS requires school districts to make contributions directly to your 403(b) account; they cannot be made through an intermediary that is not a direct agent of the district. What this means is that money withheld from an employee’s paycheck should not be going to a company that simply re-forwards the money to another entity (presumably a 403(b) vendor). This appears to be a violation of IRS rules and regulations.
Second, even if it isn’t a violation of IRS rules and regulations to send money to an entity that is not the product vendor it should be a practice that is frowned upon as the district has absolutely no control of the entity it is forwarding the money too. If the entity a district forwards money too goes bankrupt or just steals the money before sending it to the actual provider the employee has lost money. Presumably the school district should have exercised better fiscal control and will in the end reimburse the employee for the losses incurred by the intermediary. School employees and school districts are financially exposed to these “403(b) intermediaries” and should not forward money to them. In fact, a district should research vendors before allowing them on an approved vendor list to ensure that the vendor actually offers a product and that school employee money will go directly to that product (as required by the IRS). Districts are not currently doing this and are left exposed. Districts should be actively policing and auditing their vendors.
The third reason these “403(b) intermediaries” are dangerous is because they act as a middleman in the process and drive up the cost of products and make compliance nearly impossible for a school district. How is a school district supposed to monitor loans, hardships, and other distributions when it doesn’t even know who has their employee’s money?
If you take the above three events and combine them with the fact that 403(b) products on the whole benefit the financial services industry more than the employees they are suppose to serve you have a situation of The Perfect Storm.
This Perfect Storm will combine to force the pendulum to swing from an industry in favor of financial services companies (and agents) to an industry that favors the end user, the participant. There are many ways this can happen, but I believe the best way is for school districts to combine with other school districts (combine buying power) and to move toward a fiduciary based Single Vendor System.
A Single Vendor System would solve all the above mentioned problems and if done right could save hundreds of millions of dollars annually while improving the 403(b). This system I envision is one that has been rejected outright by the leaders of the NTSAA (the trade organization that represents the 403(b) industry) because they believe it will hurt the agents who are their members. School districts, their unions, and their employees must come together for once on this issue and stand up to the financial services industry that controls the 403(b) and find a better way.
There is a better way; the winds of change are beginning to blow.
Scott Dauenhauer, CFP, MSFP
It’s Time To Get Serious About 403(b)/457(b) Retirement Plans
The perfect storm is developing in the 403(b) world, only this storm has the potential to wreck serious harm on the 403(b) industry, not the employees the industry portends to serve. The outcome of this perfect storm could very well spell the beginning of the end for the current inefficient distribution method of the 403(b) retirement plan. It is time the school districts and county office of educations around the country began taking these back burner retirement plans seriously. The education community has the opportunity to take back a retirement plan that was started as an employee benefit, but has largely become a subsidy for the financial services industry.
What are the events that are precipitating this Perfect Storm?
A Movement Begins
The first event isn’t really an event, it is a movement that began in 2000 when a teacher by the name of Dan Otter started a website called www.403bwise.com that allowed a community of like minded educators to congregate in one place and speak out against 403(b) abuses in the industry and simultaneously provide unbiased education about retirement plans available to school employees. Dan eventually teamed up with myself to write “The 403(b) Wise Guide,” a manual on how to effectively utilize the 403(b) retirement plan. The book has sold over 10,000 copies and led to a second book solely authored by Dan called “Teach and Retire Rich.” These two books have had the effect of educating the educators and have started a “Great Awakening” among them about how best to save for retirement.
The IRS Issues New Regulations
The second event is the Proposed IRS regulations for the 403(b) which are scheduled to become final January 1st, 2007. These regulations are far reaching and require the employer to take control of the 403(b), whether the employer wants to or not. The new regulations require the employer to monitor all transfers, distributions, loans, and to create a plan document that governs how the plan will be run. While the employer is currently obligated to do many of these things already most don’t, but they won’t be able to get away with not complying anymore.
The new regulations are serious and will create a compliance nightmare if school districts continue to offer a long list of providers. The 403(b) industry is scared of these regulations and is fighting them. The spokes group for the 403(b) financial services industry is the National Tax Sheltered Accounts Association and they have attempted to hire a lobbyist to fight these regulations, though they couldn’t come up with the money from their members, mainly insurance agents. However, insurance companies themselves are taking the battle to congress and they are a powerful lobby. My hope is that they don’t get their way. The new regulations will be tough to comply with under the current way of operating, however they will be simple if a new way is adopted.
Intermediaries Fail
The third and most disturbing event is the series of third party administrator (TPA’s) failures over the past 18 months. These TPA’s were responsible for accepting money from school districts and forwarding it to the 403(b) vendors the educators want to invest in. The TPA’s were also responsible for keeping the plan in compliance. Horizon Benefits Administration, NEBSonline, and Plan Compliance Group have not only failed over the past 18 months but are all facing criminal investigations, lawsuits, and worst of all they (allegedly) stole money from school district employees. The latest, Plan Compliance Group has taken school districts across the country for over $3 million. School districts across the nation are sending money to TPA’s with very few checks and balances in place to prevent this theft and they are paying for this mistake out of their own pocket.
Not only are districts sending money to TPA’s who may not be financially viable they are sending money to financial services companies that don’t actually have their own products (I dub them “403(b) Intermediaries”). There are many “payroll slots” in school districts where money is sent to a financial services firm and that firm deposits the money to their own corporate accounts before sending the money onto another 403(b) vendor. These companies either don’t have a 403(b) product or their own or they offer their product alongside of others. Though this is common practice in the industry it is dangerous for three reasons.
First, the IRS clearly states in publication 571 that “Generally only your employer may make contributions to your 403(b) account” through a salary reduction agreement and “this agreement allows your employer to withhold money from your paycheck to be contributed directly into a 403(b) account for your benefit” (emphasis added). Thus the IRS requires school districts to make contributions directly to your 403(b) account; they cannot be made through an intermediary that is not a direct agent of the district. What this means is that money withheld from an employee’s paycheck should not be going to a company that simply re-forwards the money to another entity (presumably a 403(b) vendor). This appears to be a violation of IRS rules and regulations.
Second, even if it isn’t a violation of IRS rules and regulations to send money to an entity that is not the product vendor it should be a practice that is frowned upon as the district has absolutely no control of the entity it is forwarding the money too. If the entity a district forwards money too goes bankrupt or just steals the money before sending it to the actual provider the employee has lost money. Presumably the school district should have exercised better fiscal control and will in the end reimburse the employee for the losses incurred by the intermediary. School employees and school districts are financially exposed to these “403(b) intermediaries” and should not forward money to them. In fact, a district should research vendors before allowing them on an approved vendor list to ensure that the vendor actually offers a product and that school employee money will go directly to that product (as required by the IRS). Districts are not currently doing this and are left exposed. Districts should be actively policing and auditing their vendors.
The third reason these “403(b) intermediaries” are dangerous is because they act as a middleman in the process and drive up the cost of products and make compliance nearly impossible for a school district. How is a school district supposed to monitor loans, hardships, and other distributions when it doesn’t even know who has their employee’s money?
If you take the above three events and combine them with the fact that 403(b) products on the whole benefit the financial services industry more than the employees they are suppose to serve you have a situation of The Perfect Storm.
This Perfect Storm will combine to force the pendulum to swing from an industry in favor of financial services companies (and agents) to an industry that favors the end user, the participant. There are many ways this can happen, but I believe the best way is for school districts to combine with other school districts (combine buying power) and to move toward a fiduciary based Single Vendor System.
A Single Vendor System would solve all the above mentioned problems and if done right could save hundreds of millions of dollars annually while improving the 403(b). This system I envision is one that has been rejected outright by the leaders of the NTSAA (the trade organization that represents the 403(b) industry) because they believe it will hurt the agents who are their members. School districts, their unions, and their employees must come together for once on this issue and stand up to the financial services industry that controls the 403(b) and find a better way.
There is a better way; the winds of change are beginning to blow.
Scott Dauenhauer, CFP, MSFP
Thursday, December 08, 2005
iLind.net - Plan Compliance Group Follow Up
iLind.net
A Hawaii Blogger is following the events of Plan Compliance Group and has some additional thoughts.
Scott
A Hawaii Blogger is following the events of Plan Compliance Group and has some additional thoughts.
Scott
No Losses For Orange County School Districts
After speaking with the President of Envoy Plan Services I have been assured that no Orange County School Districts (or any Envoy school districts) have been harmed or lossed money due to Envoy's sub-contractors legal problems and allegations of theft. Envoy stopped using Plan Compliance Group in October after running the September payroll.
Plan Compliance Group allegedly stole or misappropriated nearly $3 million from school districts as it acted as a conduit from the districts to 403(b) vendors. The alleged theft took place in September. I will be providing a full report soon on what has taken place.
It is clear that school districts going forward are going to need to put better safe guards in place to ensure the employee's money is not lost due to bad Third Party Administrators. Plan Compliance Group is the third TPA to be accused of theft in the last year.
To be clear - Envoy Plan Services no longer uses Plan Compliance Group for Common Remitting though will continue to use Plan Compliance Group for compliance functions and number crunching through the end of this month. PCG will not have any control of Envoy School Districts money and Envoy is not cited or alleged to have done anything wrong.
More on this too come.
Scott Dauenhauer, CFP, MSFP
Plan Compliance Group allegedly stole or misappropriated nearly $3 million from school districts as it acted as a conduit from the districts to 403(b) vendors. The alleged theft took place in September. I will be providing a full report soon on what has taken place.
It is clear that school districts going forward are going to need to put better safe guards in place to ensure the employee's money is not lost due to bad Third Party Administrators. Plan Compliance Group is the third TPA to be accused of theft in the last year.
To be clear - Envoy Plan Services no longer uses Plan Compliance Group for Common Remitting though will continue to use Plan Compliance Group for compliance functions and number crunching through the end of this month. PCG will not have any control of Envoy School Districts money and Envoy is not cited or alleged to have done anything wrong.
More on this too come.
Scott Dauenhauer, CFP, MSFP
Wednesday, December 07, 2005
25 Schools District Sold A Ridiculosly High Cost Retirement Plan
Press Release - RSG Elite Choice
Perhpas the most scary observation was the following from this press release:
"Denise Smith, Director of Human Resources for the Imperial County Office of Education says, "We found that Elite Choice offered the most comprehensive and competitively priced program. Elite Choice is a total solution for the district and employers. Elite Choice quite simply fits our needs, and so far has exceeded our expectations."
I've reviewed this Elite Choice plan and found it to be among the most expensive retirement options ever offered. The claim that this plan meets a districts fiduciary responsibility is laughable as the fees are absolutely outrageous.
If you've adopted this plan as a district you can expect to pay about 3% in fees annually.
Scott Dauenhauer, CFP, MSFP
Perhpas the most scary observation was the following from this press release:
"Denise Smith, Director of Human Resources for the Imperial County Office of Education says, "We found that Elite Choice offered the most comprehensive and competitively priced program. Elite Choice is a total solution for the district and employers. Elite Choice quite simply fits our needs, and so far has exceeded our expectations."
I've reviewed this Elite Choice plan and found it to be among the most expensive retirement options ever offered. The claim that this plan meets a districts fiduciary responsibility is laughable as the fees are absolutely outrageous.
If you've adopted this plan as a district you can expect to pay about 3% in fees annually.
Scott Dauenhauer, CFP, MSFP
The Fall of the TPA - School Districts Stuck With Losses
In September of 2003 I wrote a short story titled "The Rise of The TPA." At that time we were beginning to see school districts hire Third Party Administrators to help with compliance issues relating to their 403(b) & 457(b) plans. I devoted a lot of my attention in 2003 and 2004 to one TPA, Envoy Plan Services. I didn't like Envoy or how it conducted business and I wrote to several school districts expressing my concerns. Envoy is at this point still in business, however the company it uses (or used to use) to outsource its compliance and common remitting has apparently gone to the dark. Plan Compliance Group is being accused by three states of mishandling or stealing school employees retirement funds. There is no evidence that Envoy is involved, nor have they been mentioned in any reprots, investigations, or lawsuits. I am at this point unclear of the relationship with Envoy and Plan Compliance Group, though I have call into Robert Hornaday to find out.
Plan Compliance Group is being charged with stealing money from school employees and I have been unable to reach Bill Reimers, the President for over a month to find out if he has a side to his story. The Department of Education in Hawaii and the Attorney General of Hawaii are the first to sue Plan Compliance Group for money that has disappeared.
This is not an isolated event, Plan Compliance Group is just the latest in a series of TPA failures in the U.S. that has literally cost educators millions of dollars (actually it cost the school districts millions). Last year both Horizon/Flagship Benefits Administrators and NEBSOnline both failed after stealing money from school employees before sending their retirement contributions on to the intended retirement vendor.
I have compiled links to several articles regarding the failures of these companies and will continue to update you on the Plan Compliance Group situation.
Horizon/Flagship
Unions sue districts over missing retirement funds
REVOCATION of ohio salesperson license
HAROLD HOPKINS INDICTED ON 56 COUNTS OF SECURITIES LAW VIOLATIONS
Missing investment funds scandal spreads beyond islands
Local couple named in securities/pension lawsuit
NEBSOnline
Financial officer's death adds twist to probe at retirement administrator
Ontario-Montclair fights teachers' lawsuit
Plan Compliance Group
DOE sues California firm over lapse in pension fund
Department of Attorney General - Hawaii News Release
School District Deals with Missing Money - includes video
State of Hawaii DOE Files Legal Action Against Plan Compliance Group, Ltd.
California company accused of mishandling Hawaii funds
Missing investment funds scandal spreads beyond islands
Statement by Superintendent Patricia Hamamoto regarding Employee Tax Sheltered Annuity Funds
Schools share pension woes
State Investigates Company Managing DOE Retirement Annuity Includes Video
I will continue to track this developing story. I have put in several phone calls to Mr. Reimers without a response. I have also called Envoy Plan Services to get their response. At this point it is unclear whether a relationship still exists with Plan Compliance Group and Envoy or whether any funds are missing. As soon as I find out more information, good or bad, I'll update this blog.
Scott Dauenhauer, CFP, MSFP
Plan Compliance Group is being charged with stealing money from school employees and I have been unable to reach Bill Reimers, the President for over a month to find out if he has a side to his story. The Department of Education in Hawaii and the Attorney General of Hawaii are the first to sue Plan Compliance Group for money that has disappeared.
This is not an isolated event, Plan Compliance Group is just the latest in a series of TPA failures in the U.S. that has literally cost educators millions of dollars (actually it cost the school districts millions). Last year both Horizon/Flagship Benefits Administrators and NEBSOnline both failed after stealing money from school employees before sending their retirement contributions on to the intended retirement vendor.
I have compiled links to several articles regarding the failures of these companies and will continue to update you on the Plan Compliance Group situation.
Horizon/Flagship
Unions sue districts over missing retirement funds
REVOCATION of ohio salesperson license
HAROLD HOPKINS INDICTED ON 56 COUNTS OF SECURITIES LAW VIOLATIONS
Missing investment funds scandal spreads beyond islands
Local couple named in securities/pension lawsuit
NEBSOnline
Financial officer's death adds twist to probe at retirement administrator
Ontario-Montclair fights teachers' lawsuit
Plan Compliance Group
DOE sues California firm over lapse in pension fund
Department of Attorney General - Hawaii News Release
School District Deals with Missing Money - includes video
State of Hawaii DOE Files Legal Action Against Plan Compliance Group, Ltd.
California company accused of mishandling Hawaii funds
Missing investment funds scandal spreads beyond islands
Statement by Superintendent Patricia Hamamoto regarding Employee Tax Sheltered Annuity Funds
Schools share pension woes
State Investigates Company Managing DOE Retirement Annuity Includes Video
I will continue to track this developing story. I have put in several phone calls to Mr. Reimers without a response. I have also called Envoy Plan Services to get their response. At this point it is unclear whether a relationship still exists with Plan Compliance Group and Envoy or whether any funds are missing. As soon as I find out more information, good or bad, I'll update this blog.
Scott Dauenhauer, CFP, MSFP
Tuesday, December 06, 2005
Smart Stops on the Web
Smart Stops on the Web
The Journal of Accountancy has named my site one of the Smart Stops On The Web!
Thanks!
Scott Dauenhauer, CFP, MSFp
The Journal of Accountancy has named my site one of the Smart Stops On The Web!
Thanks!
Scott Dauenhauer, CFP, MSFp
DOE loses $2.28M in pension deposits - The Honolulu Advertiser
DOE loses $2.28M in pension deposits - The Honolulu Advertiser
Districts, please read, this is of upmost importance. More on this to come....
ScottyD
Districts, please read, this is of upmost importance. More on this to come....
ScottyD
Equity Indexed Annuity Debate
Last week I got into a rather heated debate with another advisor on the topic of Equity Indexed Annuities. I don't like them and feel they are misrepresented, he apparently likes them (and likes to misrepresent them - in my opinion). I get called a few names, but I can take it. It's a long post, but has a lot of good information on both sides. I believe I debunk quite a few of his myths.
Have fun.
Scott Dauenhauer, CFP, MSFP
Have fun.
Scott Dauenhauer, CFP, MSFP
Wednesday, November 30, 2005
10 Rules for Saving For Retirement
What follows are the 10 rules you need to know to effectively save for retirement. I will expand on each one as time goes by.
- Start now
- Make it automatic (either from your paycheck or checking account)
- Diversify, Diversify, Diversify
- Don't be overly conservative in your allocation
- Don't be overly aggressive in your allocation
- Consistently increase contributions
- Tax Diversification - use both pre-tax & post tax accounts (Roth)
- Don't borrow from your retirement savings
- Keep overall expense low
- Avoid products with long surrender periods and high surrender charges
If you follow these ten rules you will have a successful retirement savings plan.
Scott Dauenhauer, CFP, MSFP
Kiplingers: I Teach Teachers How To Invest Better
403bwise creator and author of two books on financial planning for educators (including the latest, Teach and Retire Rich) Dan Otter is featured in December's publication of Kiplingers magazine. For those of you who have never met Dan Otter the above link will take you to his ugly mug (Ok, he's not that ugly, but you didn't hear it from me)!
The article is about how Dan got into educating teachers on how better to invest. Recently Dan gave a presentation based on his book Teach and Retire Rich in San Diego to a crowd of over 100 educators and it was clear that they were Wowed. The crowd had never before heard the things Dan was saying and they came away with a sense of determination to improve their financial situation. They also bought a lot of Dan's latest book which is the most excellent piece of literature ever written for educators on the topic of finance, you can pick it up at www.teachandretirerich.com or his other website www.403bwise.com. I do not get any kickbacks from the sale of his books.
Dan and I collobarated on the first book, The 403(b) Wise Guide which has become THE book on 403(b) plans - though it is now out of print (though it may make a comeback once the final 403(b) regulations are published).
It's been five years since the 403(b) Wise revolution got started and a lot has changed, but as they say, you ain't seen nothing yet!
By the way, the "financial planner" mentioned in the article is me! Thanks Dan.
Educators and School Employees - if you want to learn how better to plan for your financial future you need to read Teach and Retire Rich.
Scott Dauenhauer, CFP, MSFP
The article is about how Dan got into educating teachers on how better to invest. Recently Dan gave a presentation based on his book Teach and Retire Rich in San Diego to a crowd of over 100 educators and it was clear that they were Wowed. The crowd had never before heard the things Dan was saying and they came away with a sense of determination to improve their financial situation. They also bought a lot of Dan's latest book which is the most excellent piece of literature ever written for educators on the topic of finance, you can pick it up at www.teachandretirerich.com or his other website www.403bwise.com. I do not get any kickbacks from the sale of his books.
Dan and I collobarated on the first book, The 403(b) Wise Guide which has become THE book on 403(b) plans - though it is now out of print (though it may make a comeback once the final 403(b) regulations are published).
It's been five years since the 403(b) Wise revolution got started and a lot has changed, but as they say, you ain't seen nothing yet!
By the way, the "financial planner" mentioned in the article is me! Thanks Dan.
Educators and School Employees - if you want to learn how better to plan for your financial future you need to read Teach and Retire Rich.
Scott Dauenhauer, CFP, MSFP
Monday, November 21, 2005
Long Live The 20% Surrender Charge....
These days you'd think that excessive surrender periods and surrender charges would be gone, after all, didn't Eliot Spitzer clean up the financial services industry?
Unfortunately there are still many unscrupulous individuals and companies who sell fixed annuities that have low returns, high surrender charges, and long surrender periods. Much of the time the products are not fully disclosed. Not only that, but the products are sold by Certified Financial Planners (of which I am one). It seems that these days you can't even trust "the most trusted designation in the industry."
Recently I met a school employee who had worked in the past with a company by the name of Zuk & Associates. I have come across Zuk many times in the past and so far have never seen anything from them that impresses me. Zuk's idea of diversification during the tech bubble was to own five different Janus funds (if you don't believe me I can show you the statements). Zuk was also against AB 2506, the legislation that created a full disclosure databank online at www.403bcompare.com (I have copies of the letters they sent to client lying about the bill).
Zuk sells a lot of products from Great American, but also products from companies like AVIVA and even occasionally mutual funds. In this instance the school employee was sold several fixed annuities. Each had 10-12 year surrender periods and one (from AVIVA) had a surrender charge that started at 20%. Another of the products had a "bonus" that was supposed to make up for surrender charges in another product that the employee was told was possibly having financial problems (a whole other story). The bonus however doesn't show up until the 5th year and even then the employee doesn't actually get to keep the bonus until the 12th year. In addition, the bonus is reduced if withdrawals are made, considering the client was at retirement age when the product was sold it is unlikely the employee will ever see the bonus.
What is wrong with the 403(b) industry? I would say that these product sales were isolated instances, however when I look up who is behind the National Tax Sheltered Accounts Association (the trade organization for 403(b) agents) I find AVIVA and Great American as two of the major sponsors. The other sponsors aren't exactly pillars of wonderful products either. This indicates to me that poor products are not the exception, but the rule.
What is clear is that something needs to be done to clean this up. Selling a fixed annuity with a 20% surrender charge isn't illegal, however it is unethical, especially if it isn't properly disclosed. It is time that a new system is put in place, a system that takes the best of the 403(b) world and the best of the 401(k) world and combines it, who will do this?
School employees - it is up to you to take better care of your retirement, you are being taken advantage of every day and don't even know it. It's not all your fault, but now there are resources to help you like www.403bwise.com and www.403bcompare.com and hourly based financial planners. It is up to you to approach your union and districts and demand that they take responsibility for their retirement plans.
Scott Dauenhauer, CFP, MSFP
Unfortunately there are still many unscrupulous individuals and companies who sell fixed annuities that have low returns, high surrender charges, and long surrender periods. Much of the time the products are not fully disclosed. Not only that, but the products are sold by Certified Financial Planners (of which I am one). It seems that these days you can't even trust "the most trusted designation in the industry."
Recently I met a school employee who had worked in the past with a company by the name of Zuk & Associates. I have come across Zuk many times in the past and so far have never seen anything from them that impresses me. Zuk's idea of diversification during the tech bubble was to own five different Janus funds (if you don't believe me I can show you the statements). Zuk was also against AB 2506, the legislation that created a full disclosure databank online at www.403bcompare.com (I have copies of the letters they sent to client lying about the bill).
Zuk sells a lot of products from Great American, but also products from companies like AVIVA and even occasionally mutual funds. In this instance the school employee was sold several fixed annuities. Each had 10-12 year surrender periods and one (from AVIVA) had a surrender charge that started at 20%. Another of the products had a "bonus" that was supposed to make up for surrender charges in another product that the employee was told was possibly having financial problems (a whole other story). The bonus however doesn't show up until the 5th year and even then the employee doesn't actually get to keep the bonus until the 12th year. In addition, the bonus is reduced if withdrawals are made, considering the client was at retirement age when the product was sold it is unlikely the employee will ever see the bonus.
What is wrong with the 403(b) industry? I would say that these product sales were isolated instances, however when I look up who is behind the National Tax Sheltered Accounts Association (the trade organization for 403(b) agents) I find AVIVA and Great American as two of the major sponsors. The other sponsors aren't exactly pillars of wonderful products either. This indicates to me that poor products are not the exception, but the rule.
What is clear is that something needs to be done to clean this up. Selling a fixed annuity with a 20% surrender charge isn't illegal, however it is unethical, especially if it isn't properly disclosed. It is time that a new system is put in place, a system that takes the best of the 403(b) world and the best of the 401(k) world and combines it, who will do this?
School employees - it is up to you to take better care of your retirement, you are being taken advantage of every day and don't even know it. It's not all your fault, but now there are resources to help you like www.403bwise.com and www.403bcompare.com and hourly based financial planners. It is up to you to approach your union and districts and demand that they take responsibility for their retirement plans.
Scott Dauenhauer, CFP, MSFP
Wednesday, November 09, 2005
MSN Money - Teachers' investment plans flunk
MSN Money - Teachers' investment plans flunk
Tim doesn't get an A for accuracy oro balance, but the overall message is pretty good - School Employee Retirement Plans are for the most part BAD and they deserve better.
I continue to see simply eggregious behaviour on behalf of the industry serving school employees and I am sick of it. The self serving behaviour and flat out fraudulent behaviour has got to stop, it risks ruining educator retirements because they lack trust in the institutions delivering the services.
If you knew the things that I knew that went on behind your back you'd be ready to sue everyone in sight. It is high time that somebody stepped up to the plate and cleaned up this mess we call the 403(b). I have a vision for what that clean up would look like, but it will take a lot of hard work and faith for this vision to come true. Over the next 12 months I will slowly reveal my vision. I'd do it sooner, but I don't want to give ammunition to those who want to derail my efforts.
Scott Dauenhauer, CFP, MSFP
Tim doesn't get an A for accuracy oro balance, but the overall message is pretty good - School Employee Retirement Plans are for the most part BAD and they deserve better.
I continue to see simply eggregious behaviour on behalf of the industry serving school employees and I am sick of it. The self serving behaviour and flat out fraudulent behaviour has got to stop, it risks ruining educator retirements because they lack trust in the institutions delivering the services.
If you knew the things that I knew that went on behind your back you'd be ready to sue everyone in sight. It is high time that somebody stepped up to the plate and cleaned up this mess we call the 403(b). I have a vision for what that clean up would look like, but it will take a lot of hard work and faith for this vision to come true. Over the next 12 months I will slowly reveal my vision. I'd do it sooner, but I don't want to give ammunition to those who want to derail my efforts.
Scott Dauenhauer, CFP, MSFP
Tuesday, October 25, 2005
K Plan Features Offer Little Incentive to Participate (free login required)
I find this quite interesting considering every time I bring up the topic of 403b plans having much lower participation rates than 401k plans I get attacked about the lack of a match in the 403b. Turns out that the match doesn't account for the huge gap.
Now, of course the industry will always have the pension arguement to fall back on (since there is a pension there is less participation), but I don't wholly buy that arguement either (though I do believe the pension provides a false sense of security leading some to not participate or participate as much as they should). If 403b participation is in the 40% range and 401k's are in the 70% range the difference cannot just be the pension plan (of which there are still private sector employees who offer both), perhaps the difference can be explained by something else........structure.
The 403b is structured terribly, it is fragmented and has an ugly retail distribution model. The 403b needs reform and I believe the new regs just be provide that impetus. It's time that a new model was given a chance.
ScottyD
Now, of course the industry will always have the pension arguement to fall back on (since there is a pension there is less participation), but I don't wholly buy that arguement either (though I do believe the pension provides a false sense of security leading some to not participate or participate as much as they should). If 403b participation is in the 40% range and 401k's are in the 70% range the difference cannot just be the pension plan (of which there are still private sector employees who offer both), perhaps the difference can be explained by something else........structure.
The 403b is structured terribly, it is fragmented and has an ugly retail distribution model. The 403b needs reform and I believe the new regs just be provide that impetus. It's time that a new model was given a chance.
ScottyD
Monday, October 24, 2005
Some fear decline of 403(b) plans under new law - InvestmentNews
Interesting article, but I think it misses the point. Those fearing the decline of the 403b are sales agents, not educators and the decline they are referring to is commissions, not the actual demise of the 403(b). I think the new regs will have some dissapointing effects at first, but then I think the market will adjust and 403b's will become stronger than ever. There is always opportunity in chaos.
ScottyD
ScottyD
Tuesday, October 04, 2005
Public Sector (403b/457) Plan Sponsors Confront Participation Challenges
It's a tough world in the 403b/457 arena, but a few changes could make it easy - unfortunately they aren't addressed in this article.
Scott Dauenhauer, CFP, MSFP
Magazine Articles [PLANSPONSOR.com]
Scott Dauenhauer, CFP, MSFP
Magazine Articles [PLANSPONSOR.com]
Tuesday, September 20, 2005
www.GovExec.com - Cost of managing TSP continues to shrink (9/19/05)
This plan is a good example of how a retirement plan can be run at a low cost, however this plan is not all it is cracked up to be. It can be vastly improved without much of an increase in costs. I think State Teachers Retirement Systems should take a cue from the TSP - basically using the vast economies of scale of millions of workers with commonality to build a large asset base and lower costs. However, I believe this plan can be vastly improved upon. The education, website, and recordkeeping are horrible. If the TSP gave me one hour I could give them enough suggestions to make this plan the darling of all investment plans.
Scott Dauenhauer, CFP, MSFP
www.GovExec.com - Cost of managing TSP continues to shrink (9/19/05)
Scott Dauenhauer, CFP, MSFP
www.GovExec.com - Cost of managing TSP continues to shrink (9/19/05)
Pay For Long Term Care Insurance via 401k or 403b?
This is a good idea and one that we should all support. We need to find a way to make long term care insurance affordable and the ability to use pre-tax dollars saved in 401k or 403b plans is one way we can do that.
CAHI
CAHI
Wednesday, September 14, 2005
403(b) Proposed Regs Delayed - NTSAA Press Release
The following Press Release came from the NTSAA today. The NTSAA is the leading organization against the implementation of the proposed regulations from the IRS.
The new regs are needed and I believe will lead most 403(b)’s to actually become 403(b) PLANS – as opposed to arrangements. I think this will lead to a system where districts will adopt a single vendor for their 403(b). At this point 403(b)’s will begin operating very similar to 401(k) plans.
I am happy however with the following release because it gives districts more time to comply with the proposed regs.
Scott Dauenhauer, CFP®, MSFP
Congress has returned to Washington from summer recess. We would like to acknowledge and thank members who contacted Senators and Representatives while they were in their respective “home” districts. If you had success contacting your own representative or senator (or a member of staff) during recess, please be sure to report that information to the NTSAA as it is important to keep a record of interested members of Congress for possible future actions.
New: Treasury & IRS Remarks:
We wanted to report comments made by Tom Reeder of Treasury and Robert Architect of the IRS at a Washington D. C. conference held last week as reported in the September 9, 2005 edition of Tax Notes Today:
Tom Reeder of Treasury and Bob Architect of the IRS “devoted most of their time to discussion of proposed regulations on section 403(b) plans” and noted that the “regs will not be effective before January 1, 2007”. He also expressed optimism that the regs will be finalized in the first or second quarter of 2006. Architect also said, "that it is likely the effective dates of some entities, such as church plans will be pushed back even further.”
In terms of the controversial written plan requirement, Reeder said, “No where in the code does it say a 403(b) plan does not have to be written. In fact, the fact that the statute refers to the word 'plan' implies that there ought to be a written plan.” To further explain that requirement, he said, “We’re not talking about a plan document in a 401(a) sense. We’re talking about a plan document that someone can use to reference what the terms of the plan are.”
In referring to the repeal of Revenue Ruling 90- 24, Architect said, "that the Service wants to get beyond Rev. Rul. 90-24 because it has complicated efforts at compliance by employers and has made enforcement more difficult for IRS agents.” However, Tom Reeder did say that “the final regs might permit some transfers that would not be allowed under the proposed regs”.
What Do We Think?
We believe that your efforts should continue, but focus almost entirely on contacts with members of Congress. Sample letters and other information to assist with these efforts can be found at www.ntsaa.org, under the “Advocacy" link.
It is important to note that Tom Reeder’s reference to the fact that the statute refers to the word “plan” is evidently based on IRC 403(b)(12) (which covers nondiscrimination rules added in the Tax Reform Act of 1986) where in (A) it says “a plan meets the nondiscrimination requirements of this paragraph if”, and in (C) there is the title “State and Local Governmental Plans”, and Plan is also used in the body of that section.
The key question for members of Congress is whether the intent was to apply the rules of plans to 403(b) arrangements, when in fact, all previous legislative history took the opposite approach. Despite many opportunities to do so, Congress has never mandated a written plan requirement for 403 (b). Even so, discussions with Treasury indicate that both Treasury and the Service hold the belief that Congress intends this result (when, in fact, Congress may well not be aware of the ramifications of the proposed changes).
Finally, as we review the Examination Guidelines, it is made clear in the detailed explanations of 403(b), that “403(b) plans take a wide variety of forms. Even where a 403(b) plan takes the form of an arrangement rather than a plan, it is nevertheless subject to all of the requirements of 403(b)”. Note that unlike qualified plans, the requirements in the 403(b) statutes do not include a written plan. In the plan document section of the Guidelines, the statement is made, “Unlike qualified plans, 403(b) plans are not subject to the requirements of a definite written program (although Title I requires a written plan document for certain 403(b) plans).”
We will continue to keep you informed, and ask that you continue your efforts to get employers, unions, and participants to contact Members of Congress.
NTSAA http://www.ntsaa.org/advocacy1.php
Ellie Lowder
Technical Advisor
email: info@ntsaa.org
The new regs are needed and I believe will lead most 403(b)’s to actually become 403(b) PLANS – as opposed to arrangements. I think this will lead to a system where districts will adopt a single vendor for their 403(b). At this point 403(b)’s will begin operating very similar to 401(k) plans.
I am happy however with the following release because it gives districts more time to comply with the proposed regs.
Scott Dauenhauer, CFP®, MSFP
Congress has returned to Washington from summer recess. We would like to acknowledge and thank members who contacted Senators and Representatives while they were in their respective “home” districts. If you had success contacting your own representative or senator (or a member of staff) during recess, please be sure to report that information to the NTSAA as it is important to keep a record of interested members of Congress for possible future actions.
New: Treasury & IRS Remarks:
We wanted to report comments made by Tom Reeder of Treasury and Robert Architect of the IRS at a Washington D. C. conference held last week as reported in the September 9, 2005 edition of Tax Notes Today:
Tom Reeder of Treasury and Bob Architect of the IRS “devoted most of their time to discussion of proposed regulations on section 403(b) plans” and noted that the “regs will not be effective before January 1, 2007”. He also expressed optimism that the regs will be finalized in the first or second quarter of 2006. Architect also said, "that it is likely the effective dates of some entities, such as church plans will be pushed back even further.”
In terms of the controversial written plan requirement, Reeder said, “No where in the code does it say a 403(b) plan does not have to be written. In fact, the fact that the statute refers to the word 'plan' implies that there ought to be a written plan.” To further explain that requirement, he said, “We’re not talking about a plan document in a 401(a) sense. We’re talking about a plan document that someone can use to reference what the terms of the plan are.”
In referring to the repeal of Revenue Ruling 90- 24, Architect said, "that the Service wants to get beyond Rev. Rul. 90-24 because it has complicated efforts at compliance by employers and has made enforcement more difficult for IRS agents.” However, Tom Reeder did say that “the final regs might permit some transfers that would not be allowed under the proposed regs”.
What Do We Think?
We believe that your efforts should continue, but focus almost entirely on contacts with members of Congress. Sample letters and other information to assist with these efforts can be found at www.ntsaa.org, under the “Advocacy" link.
It is important to note that Tom Reeder’s reference to the fact that the statute refers to the word “plan” is evidently based on IRC 403(b)(12) (which covers nondiscrimination rules added in the Tax Reform Act of 1986) where in (A) it says “a plan meets the nondiscrimination requirements of this paragraph if”, and in (C) there is the title “State and Local Governmental Plans”, and Plan is also used in the body of that section.
The key question for members of Congress is whether the intent was to apply the rules of plans to 403(b) arrangements, when in fact, all previous legislative history took the opposite approach. Despite many opportunities to do so, Congress has never mandated a written plan requirement for 403 (b). Even so, discussions with Treasury indicate that both Treasury and the Service hold the belief that Congress intends this result (when, in fact, Congress may well not be aware of the ramifications of the proposed changes).
Finally, as we review the Examination Guidelines, it is made clear in the detailed explanations of 403(b), that “403(b) plans take a wide variety of forms. Even where a 403(b) plan takes the form of an arrangement rather than a plan, it is nevertheless subject to all of the requirements of 403(b)”. Note that unlike qualified plans, the requirements in the 403(b) statutes do not include a written plan. In the plan document section of the Guidelines, the statement is made, “Unlike qualified plans, 403(b) plans are not subject to the requirements of a definite written program (although Title I requires a written plan document for certain 403(b) plans).”
We will continue to keep you informed, and ask that you continue your efforts to get employers, unions, and participants to contact Members of Congress.
NTSAA http://www.ntsaa.org/advocacy1.php
Ellie Lowder
Technical Advisor
email: info@ntsaa.org
Friday, August 26, 2005
FOXNews.com - U.S. & World - California Facing Teacher Shortage
Perhaps teacher salaries will rise faster than inflation over the next decade. When California faced a nursing shortage (which it still does) wages rose (as supply and demand would indicate). With home prices where they are right now it is no wonder a person in college would choose a different career than teaching. Teacher wages are going to have to rise in order to attract and retain quality (heck even unqualified) educators.
ScottyD
Perhaps teacher salaries will rise faster than inflation over the next decade. When California faced a nursing shortage (which it still does) wages rose (as supply and demand would indicate). With home prices where they are right now it is no wonder a person in college would choose a different career than teaching. Teacher wages are going to have to rise in order to attract and retain quality (heck even unqualified) educators.
ScottyD
Thursday, August 25, 2005
Teachers have few defenses when investing in 403(b)s
The Wall Street Journal lays out a great case for better 403b plans and oversight, read this article carefully.
Scott
The Wall Street Journal lays out a great case for better 403b plans and oversight, read this article carefully.
Scott
Monday, March 28, 2005
Teach and Retire Rich is now available.
Teacher Dan Otter has released his newest book, Teach and Retire Rich. I've had the opportunity to preview the book and it is a must read for anybody in education. Every single educator in the US should be required to read this book as it will give them the insights they need to retire.
The title may sound a bit outrageous, but believe me it is worthy of its title. Pick up this book now at http://teachandretirerich.com
Scott
Teacher Dan Otter has released his newest book, Teach and Retire Rich. I've had the opportunity to preview the book and it is a must read for anybody in education. Every single educator in the US should be required to read this book as it will give them the insights they need to retire.
The title may sound a bit outrageous, but believe me it is worthy of its title. Pick up this book now at http://teachandretirerich.com
Scott
Monday, March 14, 2005
Tired of Those High Paid Teachers!
I, for one, am sick and tired of those high paid teachers. Their hefty salaries are driving up taxes, and they only work 9 or 10 months a year!
Its time we put things in perspective and pay them for what they do, baby sit! We can get that for less than minimum wage. That's right?
I would give them $3.00 an hour and only the hours they worked, not any silly planning time. That would be $15.00 a day. Each parent should pay $15.00 a day for these teachers to baby-sit their children. Now, how many do they teach in a day?.... maybe 25. Then that's 15 x 25 =
$375.00 a day.
But remember they only work 180 days a year! I'm not going to pay them for any vacations. Let's see? That's 375 x 180 $67,500.00. (Hold on, my calculator must need batteries!)
What about those special teachers or the ones with Masters Degrees?
Well, we could pay them minimum wage just to be that fair. Let's round it off to $6.00 an hour. That would be $6.00 times five hours times 25 children times 180 days = $135,000.00 per year. Wait a minutes, there is something wrong here!!!!
There sure is, huh ??????!!!!
Send this to any teachers YOU may know. I'm sure they'd gladly accept baby-sitting rates!
ScottyD (this was not written by me, I have no idea who wrote it!)
I, for one, am sick and tired of those high paid teachers. Their hefty salaries are driving up taxes, and they only work 9 or 10 months a year!
Its time we put things in perspective and pay them for what they do, baby sit! We can get that for less than minimum wage. That's right?
I would give them $3.00 an hour and only the hours they worked, not any silly planning time. That would be $15.00 a day. Each parent should pay $15.00 a day for these teachers to baby-sit their children. Now, how many do they teach in a day?.... maybe 25. Then that's 15 x 25 =
$375.00 a day.
But remember they only work 180 days a year! I'm not going to pay them for any vacations. Let's see? That's 375 x 180 $67,500.00. (Hold on, my calculator must need batteries!)
What about those special teachers or the ones with Masters Degrees?
Well, we could pay them minimum wage just to be that fair. Let's round it off to $6.00 an hour. That would be $6.00 times five hours times 25 children times 180 days = $135,000.00 per year. Wait a minutes, there is something wrong here!!!!
There sure is, huh ??????!!!!
Send this to any teachers YOU may know. I'm sure they'd gladly accept baby-sitting rates!
ScottyD (this was not written by me, I have no idea who wrote it!)
Monday, January 31, 2005
The Teachers Advocate Blog Returns.....
It's been almost 8 months since my last post to this blog, which means that people have probably stopped checking it. I am now attempting to revive it. My absence has been because I have been incredibly busy with my business. Things haven't slowed down for me, I am more busy now that last month, but I figured that this blog is important enough to fit in. I am also maintaining a blog for my company (and it's clients) at themeridian.blogspot.com. The Meridian will cover more general topics in personal finance as well as current events. This blog is more designed for educators.
A wonderful story was written yesterday by the San Diego Union Tribune. David Washburn, a reporter at the paper spent months tracking and writing this story and it paid off big time. The title of the story is "Teachers get Harsh Lesson on Investing" and you can find it at the following link - http://www.signonsandiego.com/news/metro/20050130-9999-1n30403b.html. The crux of the article is that teachers, in general are getting screwed. They are getting screwed by the district, the agents peddling poor products, the companies distributing to the agents, and themselves. Teachers need to take a more active role because it appears nobody else will do it for them, the article gives them a few tools. Another exciting thing about this article is that it wasn't just on the front page of the business section, it was on the front page of the Newspaper, above the fold - right next to a story on the Iraqi Elections..... I believe this is the most prominently published piece ever done on 403(b) plans.
I am very proud that my name appeard 8 times in the article....thanks Dave! But I am more proud of the educators who were willing to share their stories. It was also great to see 403(b) patriot Barbara Healy with some great quotes and insights. Finally, Dan Otter and his website were prominently featured as well, along with www.403bcompare.com.
In the coming days, weeks, & months I will begin blogging on a very important and upcoming issue that will affect our future educators - the Termination of CalSTRS. The Terminator (Governator) has set his target on public employee pension plans and promises to take this fight to the people. I will attempt to provide good, clean coverage of what issues are involved and whether it is a good or bad idea. Your thoughts are always welcome.
Unitll next time............
ScottyD
It's been almost 8 months since my last post to this blog, which means that people have probably stopped checking it. I am now attempting to revive it. My absence has been because I have been incredibly busy with my business. Things haven't slowed down for me, I am more busy now that last month, but I figured that this blog is important enough to fit in. I am also maintaining a blog for my company (and it's clients) at themeridian.blogspot.com. The Meridian will cover more general topics in personal finance as well as current events. This blog is more designed for educators.
A wonderful story was written yesterday by the San Diego Union Tribune. David Washburn, a reporter at the paper spent months tracking and writing this story and it paid off big time. The title of the story is "Teachers get Harsh Lesson on Investing" and you can find it at the following link - http://www.signonsandiego.com/news/metro/20050130-9999-1n30403b.html. The crux of the article is that teachers, in general are getting screwed. They are getting screwed by the district, the agents peddling poor products, the companies distributing to the agents, and themselves. Teachers need to take a more active role because it appears nobody else will do it for them, the article gives them a few tools. Another exciting thing about this article is that it wasn't just on the front page of the business section, it was on the front page of the Newspaper, above the fold - right next to a story on the Iraqi Elections..... I believe this is the most prominently published piece ever done on 403(b) plans.
I am very proud that my name appeard 8 times in the article....thanks Dave! But I am more proud of the educators who were willing to share their stories. It was also great to see 403(b) patriot Barbara Healy with some great quotes and insights. Finally, Dan Otter and his website were prominently featured as well, along with www.403bcompare.com.
In the coming days, weeks, & months I will begin blogging on a very important and upcoming issue that will affect our future educators - the Termination of CalSTRS. The Terminator (Governator) has set his target on public employee pension plans and promises to take this fight to the people. I will attempt to provide good, clean coverage of what issues are involved and whether it is a good or bad idea. Your thoughts are always welcome.
Unitll next time............
ScottyD
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