"These plans, typically offered to teachers, resemble 401(k) plans, with the same tax benefits, maximum contribution thresholds and catch-up contributions. But while private-sector plans usually contain a suite of mutual funds selected by a management committee, the primary offerings in many 403(b) plans are high-cost investments, such as equity-indexed annuities. That's because many school districts have little desire to negotiate with financial-services firms.
Still, there have been some positive developments. For example, the board of education in Montgomery County, Md., has contracted with no-load mutual fund company Fidelity Investments to administer its 403(b) plans. For advice on how to advocate for a better plan, go to www.403bwise.com. In the meantime, teachers with a lackluster plan may be better off investing in a Roth IRA."