Message Font: Serif | Sans-Serif
No. of Recommendations: 2

You wrote, I have a question regarding 403b's, I think it is the counterpart of 401k , albiet for small companies.

403(b) is for non-profit and (quasi)government organizations such as public schools.

Also, I am trying to help my friend and her mother out by trying to give her suggestions for her retirement plans and find myself lacking in knowledge about the 403b's.

You will have to contact your friend's mother's payroll department and ask them who is on their authorized list. The payroll department can and often does restrict the list of 403(b) providers obstensibly to ensure that the monies are being directed to appropriate investment vehicles.

Unfortunatley, the the ability to place these restrictions often wind up being abused in small companies and school systems. Such restrictions often mean that the only authorized 403(b) provider is the friend of someone on the board of directors. And that usually leaves you with only high-price annuity or heavily loaded mutual funds.

Check out her options before you push her too hard in that direction.

This behavior with 403(b) is unfortunate. If the authorized 403(b) provider list is relatively unrestricted, a 403(b) plan has the potential to be quite superior to a 401(k). Of course, the offerings in the 401(k)s at some companies aren't any better.

- Joel
Who's only experience w/403(b) is via his XSO, who's a public school teacher.
Print the post  


What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.