Granite Group Advisors -

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2016-10-25 :: Think Your Retirement Plan Is Bad? Talk to a Teacher
Schoolteachers and others who pursue careers of service in exchange for modest paychecks get lightly regulated retirement plans that often charge excessive fees.

 

In a recent article in the NY Times (link below), it mentions that teacher's retirement plans are not well managed.

Employers of educational institutions need to look at a document called a 408(B). It is a document that discloses the plan costs. The DOL says that fees need to be reasonable, not necessarily cheap. Not all record-keepers are equal, and their fees and services vary. As for advisors,  there are different levels of fiduciary services. Employers need to understand the difference between fees and service levels. Then the employer needs to decide which service best fits the needs of the organization. Most teachers have their retirement plan at organizations like TIAA, Voya, Axa and others. Many of these plans are old, and have not been looked at in years.  There is very poor or little education, and usually no fiduciary service. These plans are usually filled with proprietary fund lineups, higher cost funds or even worse: both.

Granite Group developed a process to address these concerns. First, we add efficient proactive and index funds; these lower cost and adhere to defined investment process. Second, we create and manage asset allocation models based on risk to help those participants make investment allocations. The third, and most important addition, is that we educate the teachers. After a mini onsite investment seminar (enrollment meeting), we make sure everyone logs in to make their investment decision.  Our pre allocated models are managed according to the employee’s risks and or goals. Essentially, we provide and maintain a customized management system for an individual employee that was once for the very wealthy only.

To maintain the investment education, Granite Group has been able to create a special client site, which allows the employee to access GGA produced market commentaries, investment blogs, monthly investment brochures and articles written by Granite Group in well know magazines. The allocation questionnaire is also available, along with immediate access to the plan's record-keepers site.

Plans need to be simple for the employer to manage. Full disclosure on service and fees is a must. The employee is looking for a simple process that is decipherable, quick and easy, so they can make an informed decision. Employers need to seek out a fiduciary that can educate people so your employee can be more productive.

If you would like to read the original article, it is here:   Think Your Retirement Plan Is Bad? Talk to a Teacher

Speak with Ernie Rodulfo at (203) 210-7814 to discover a better way to help your teachers. With Granite Group, the company does not have to move the plan!


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