Why 403b's are the worst investment vehicle.

I work for a school district in California and the only plan that was offered to me was the following: 403(b) Tax-Sheltered Annuity Plan and within this contract, the money is invested in the following: Vanguard total stock, mid-cap, and large cap mutual funds. I did have a positive return in 2020.

I'm confused. These numbers don't match my experience with my 403B. I pay less 0.06 in fees.

There are different types of annuities. An immediate annuity is a personal pension of sorts. It can be a great option for retirees.

really insightful and helpful!

My 403b has an 8% match and has avg’d 13% annual return over the last 8 years. No annuities.

Clearly you are suffering from Dunning Kruger on this subject

What if it’s a custodial 403b through a brokerage? Like vanguard ?

Agree 100%. Our school offers a single provider Lincoln Investment. 1.24-1.53% fees plus $16.95 per quarter AND fund fees. Some of my coworkers pay 2% fees!! I opt for taxable brokerage 100% in Vtsax Instead. Very tax efficient. On top of pension and Roth IRA

I’m a nurse and my company matches up to 6%, is it worth it to take the match and then the rest in a Roth?

Way over generalized vlog post man. My 403b investment accounts with Vanguard and Fidelity (3 diff school districts) have been exactly like your description of a typical 401K. No annuities required although that is lurking as an option often. And it is a great way to pile up tax advantaged retirement funds quickly. $26K a year at my age into Roths that are rolled over to an IRA after severing. Hey, and my Interactive Brokers IRA has >thousands< of options and I like it that way.

Had a 403(b) for around ten years and rolled it into a solo 401(k) after retiring from that pubic service job. Fidelity only charged $25 per year for this account and I could select any number of mutual funds. Not a bad self-directed deal at all. My spouse currently has the same account through a similar public service employer.
Investigated a 403(b) with a public school system a few years for my spouse and the fees were around 2% annually. Awful. The school district simply did not permit their employees to have a self-directed option. Not one. Thus the higher fees.

If I have a 403(b) and I have $7,000 placed within and made $77. If I want to pull out my $7,000, what penalties or taxes would I have to pay? Would only the $77 be assigned a penalty and would the $7,000 be taxed at my regular tax rate? Also, aside from not liking the 403(b), I'm looking to use the funds to assist me in buying a condo.

How do I look to low cost funds

The cute part about this video is him assuming that all school districts are actually giving teachers an option lol

My job has a 403b with no match. Thinking of changing to roth ira as everyone is saying to do nowadays

lot of missionary organizations offer 403-Bs only, so I ignore it, and just buy a Roth IRA....

My 403(b) has Fidelity's BrokerageLink.

Is there a way to get out of my 403b while I'm still working?????

Is it possible to roll over my deceased parent 403 into my 457?

No idea what this guy is saying

So if have Roth IRA I should invest in that instead of 403b?

nobody

this guy :teachers you got homework

This was a really good video. Goodwork DT.

I have a 493b with goodwill and am more than confused on all this I’m lost with no help out here I need someone physically with me looking at my account to explain it me I have called several times they talk over my head

They aren’t all terrible. My wife and I are high earners and having a 403b allows her to contribute to her PERS plan, up to 30k a year into deferred compensation plan, and up to 30 k a year into the 403b that can be Roth or traditional. It’s our best option for post tax retirement funds. And it has a fidelity s and p index fund with an expense ratio of .02. I see no way that this is a bad deal.

What do think about 457 Plans?

a variable annuity doesn't sound too bad to someone who just lost 40% of their 401k value.... If you're about to retire and your 401k is doing well...get out. buy an annuity with a death benefit, and enjoy life.

The comment section is pretty helpful on this video, as well as the video as a starting point! Thanks to all the commenters! I’m looking into my 403 b right now!

Would you recommend a ROTH 403b?

gayest intro ive ever seen

Does the 403b also depend on the success or failure of the Stock Market/Wall Street?

I have a Fidelity 403b (instructor at Big Ten institution). The 35 offerings available to us are more in line with what you have listed under the 401k but are mostly limited to target date funds and active funds with ridiculously high fees. There are three institutional Vanguard funds which are the only worthwhile funds available that have very low fees. I just moved 100% of my money and future money into the institutional version of VOO (VIIIX) in my 403b. So now I work with my other retirement accounts knowing that I have that heavy position in my 403b because of the lack of great options to choose from. But it sucks because I just did a rollover from my past employer and I can put that money into virtually anything I want.

Quick tip, use a 403b as a fuck around tax free savings account because you can early withdrawal for almost any life event, INCLUDING a down payment on a house

How / where do you hunt for low cost funds? Is there a good resource?

This is confusing. I work for a university hospital and have the same fees (through Fidelity) for my 401a, 403b and 457b.

They’re not all teachers people that work at a College have 403B plan as well

401 k, 403b. The latter like the former is voluntary investment. In the latter it’s for public employees. These accounts used to be tax deferred only. At least for 16 years a ROTH option is permitted. It depends on what VIP one is dealing with but investments can be limited but once 59.5 yo, funds may go to a rollover account for fewer restrictions on investments.

Are there issues if your 403(b) is with TIAA with a university?

Dumbest video ever

I love my 403b, most of what you said doesnt even apply. Non-teacher here, at all, in fact all of the teachers I know dont have a 403b. Mine offers 5% pretax from the job, i give 3% after tax, my job contributes 3% match. In total, that means 70% of the value of my 403b is contributed by my job. I control my roth and investment accounts the way I want with my own money. Why would I care of what my 403b is if most of it isnt even out of my pocket?

Im stuck i.n a 403b i no longer work for the employer and they still WON'T allow me to draw my money down. I would never get into another one.

This is bad clickbaity influencer advice. It's important to know that a 403B is regulated differently than a 401k, but it's stunningly wrong to say its the worst investment vehicle or that you're better off in a savings account. You're going to be generating a lot of unnecessary stress and outrage among people who have excellent investment options in their 403B but assume they're being screwed over because you showed them the worst case scenario and then generalized it as representative of all 403B's. Shameful.

Bruce Williams:) Classic

I have no choice that’s the only retirement Fidelity account my job offers

403b has been amazing for us!

You’re correct! My 403b did nothing! I am withdrawing the funds.

What’s better— to keep my 403 b or or Charles Shwab ?

Useless video what you mean by index funds? I never heard of index funds! What are you talking about?

Amazing video, A friend of mine referred me to a financial adviser sometime ago and we got to talking about investment and money. I started investing with $150k and in the first 2 months, my portfolio was reading $274,800. Crazy right!, I decided to reinvest my profit and get more interesting. For over a year we have been working together making consistent profit just bought my second home 2 weeks ago and care for my family.

Our CFP took over my wife’s 403b(which did nothing for years) about 5 years ago. Now it’s growing at a respectable rate. It was a huge hassle to make that happen.