No. of Recommendations: 1
1. Can an employer have more that one provider for their 403b plans?

I'm no expert, but I suspect yes, if the set up is structured properly.

2. If I can get my employer to start a plan with Vanguard, can I transfer my money without incurring any fees and charges?

In most qualified tax exempt plans, yes there is a means to do a tax free transfer.

3. If my employer cannot open a Vanguard account, does it make sense to continue to contribute to a costly provider or does it make more sense to just max out an IRA and put the rest of the money into a taxable account that holds tax efficient funds?

Best is to sit down and calculate how much the expenses cost you and how much better each has to be. The major advantage of the 403b and other tax protected plans is that you can change investments from time to time without paying taxes on capital gains. Especially if you know what happened to those with big profits during the dot.com rally, you will appreciate this ability. Many probably hesitated to sell because they did not want to pay the taxes.

Long Term Buy and Hold investing is a better choice provided you can truely select investments that you can hold long term. But that is far more difficult than it seems--especially when you begin. Later when you have huge capital gains, it is less of a problem. In between, the ability to move your funds is an advantage.

But there is not formula that lets you see this. Its a trial and error thing. Try it one way. If that does not work out, do it the other way. You will learn what works for you. And if you start early enough, you will still be able to recover even if you pick wrong in the beginning.

Good luck.
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