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1. Is it common for qualified plans to offer only annuities as the investment vehicle?

Unfortunately, yes.

2. If an annuity is our only option here, do the tax advantages offered by the 403-B out-weigh the additional costs and potentially "restricted" returns offered by the mutual fund subaccounts offered through the annuity?

I'm not sure I understand that question. Having an annuity in a 403(b) is a waste. The 403(b) is already tax-deferred, but the annuity charges you a fee to make it tax-deferred. I'm not 100% positive about this, but I believe that you can invest outside the given choices in a 403(b). Check with a financial planner or with a mutual fund company. You'd be much better off going outside those choices and putting the money into mutual funds yourself.

Leviathan
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