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Sounds like you are forced to go through an approved vendor to invest your 403(b). Many school districts require its employees to choose from a list of people to set up their 403(b). This forces you to pay a commission to someone to help you set up the account. I'm in the same boat, and am extremely frustrated since I am not allowed to bypass these salespeople to invest my hard earned money.

Anyway, these agents generally force you to invest in loaded funds which will pay them a commission. Why no Vanguard funds you ask? Since Vanguard offers no-load funds, the agent can not make a commission off of the sale.

Sounds like your current vendor has you in an annuity, thus the hefty fees. Check with your HR office to find out which agents offer mutual funds, or 403(b) 7's, and which offer annuities or 403(b)'s. Your best bet will likely be the 403b(7)'s, since annuities are typically loaded with hidden fees. Check out post #11725 on this board for more info on annuities.

A word of caution: many of the reps in my district that I have met with have provided false and/or misleading information with regards to 403b's. When you meet with these people, don't forget to ask them the tough questions. You want to know exactly what charges are being levied against your account and so forth. In other words, do your homework!! I am amazed at how many of my colleagues know nothing about what funds they are in or how the 403b's work.

Hope this helps.

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