Teachers Contributing to 403b, Avoid These Companies!

by CliplessWingtips​

This has been warned of before on Reddit, but I have specifics now. Teachers, please avoid AXA, The Legend Group, Lincoln Financial, Voya, Valic or any other company with a high expense ratio. If you’d like an important read: nyti.ms/3viOcw7.

Just got off the phone with AXA (Equitable). I have $13,700 in my AXA account. If I were to roll this money to my Vanguard account, there is a $561 Surrender Fee and a $9 (prorated) Transfer Fee. To avoid a Surrender Fee, I need to wait 6 years AFTER my last contribution.

Furthermore, smart Redditors previously suggested that clients of these predatory investment companies can pull 10% out of the account every year. I asked the rollover agent about this, she said every time the 10% is rolled over to my Vanguard account, there will be a $65 Transfer Fee.

I asked her how much longer I have to wait for the account to waive a Surrender Fee. I started the account January 2019, so I assumed she would say January 2025. I was wrong. It has to be 6 years AFTER your last contribution which I made March 2021. So the surrender fee will not be waived until March 2027.

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TL; DR – Read the NYT article. Use Vanguard, TIAA or a company you actually research and fits your needs.

Question to my Master Finance Redditors: Am I making the right choice here to wait until March 2027? Or should I be spiteful and swallow these fees to leave AXA now? Thank you for dealing with investment noobz like myself.

**EDIT** After reading comments:

  1. Lincoln Financial, Voya and Valic are not as bad as the NYT article describes – fees depend on who the third party is – please simply double check your contract or call
  2. TIAA is not as great as I thought, I was wrong
  3. Research “self directed brokerage” accounts (SDBA)
  4. This is for teachers with 403(b)s only, not other professions or investment accounts
  5. If your district does not offer Vanguard, pressure HR to add any company with low fees, for example – Redditors say Fidelity is great

Disclaimer: This content does not necessarily represent the views of IWB.



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