When you think about greatness, we default to Micheal Jordan, President Lincoln or Albert Einstein. The Los Angeles Unified School District’s 457(b) plan may not appear to be great but when compared to the typical 403(b) plan, it is most certainly GREAT!Learn More
Welcome New York Times Readers to my Blog. My name is Steve Schullo, a retired Los Angeles Unified School teacher and an advocate for cheaper 403(b) plans for over 20 years. Please follow up on these fantastic (and rare) print media articles by a fantastic New York Times editorial staff, and their superb reporter Tara Siegel-Bernard.
She has been working on these articles since the beginning of the year. The educational professional and its institutions are reticent to talk about the 403(b). The rationale is easy. We educators hardly ever talk about the 403(b) publically or in any organized manner. Why? Nothing wrong with talking about how to best invest our retirement money that supplements our pension plan. After all, the 403(b) is 100% of our money.Learn More
Ten years ago a brilliant benefits administrator, George Tischler (now retired), launched Los Angeles Unified District’s 457(b) plan. Since then, our advisory committee has lowered costs and selected more index funds with broad diversification. It is the model which all employer-sponsored retirement plans should follow because the plan and the advisory committee follows the fiduciary standard. My free eBook, Fighting Powerful Interests, is about the history, development and the reasons why the Award Winning 457(b) became an option in 2006. Since I have been on the advisory committee, we have followed the fiduciary standard since day one for good reason–to look out for your best financial interests.
This blog post is for all public educators who want to discover how to use the 403(b) or the 457(b). It is specifically for my LAUSD colleagues. I will discuss fiduciary standard, a little history of our complicated relationship of LAUSD, its employees, insurance industry’s 403(b), and why the 457(b) came into fruition to fix and clarify the historical and often corrupted 403(b).
It’s that time of the year, the Quarterly Reports. I really hope you find these reports helpful for a number of reasons:
1. Show you how a portfolio of diversified stocks, bonds, and cash looks like.
2. Show how this diversified portfolio performs in coordination with the stock and bond markets.
3. The individual holdings are not selected at random, but for the purpose of doing a specific and important job in the portfolio. It’s always about the portfolio as a whole performing package, not about the individual holdings.
4. Each holding reflects a specific part of the domestic and international stock and bond markets.
5. While some of the stock asset classes have high correlations, stock and bond allocations are not. Including bonds in my portfolio helps preserve my money against a major and lengthy stock market crash. This is known as the stock bond split. My portfolio is 30% stocks and 70% bonds. My 30% exposure to stocks provides enough risk that my portfolio should keep up with inflation (This is not a guarantee, it is part of my diversification and asset allocation plan).
6. This portfolio is an example of a conservative portfolio for a 69-year-old retiree.Learn More
Every time we offer one of these rare investment workshops, the workshop participants always comment that they want “more of the same.” Only two per year can be provided because of costs. UTLA and LAUSD do not fund these workshops. To their benefit, UTLA does provide the room, and Eva for paperwork and logistical support, and we thank UTLA for that support. On the other hand, LAUSD has rejected support for these workshops for years. We need to inform the Board of Education that financial literacy education is a significant benefit for their employees. If more employees knew of the district’s Award Winning 457(b) plan, more educators would save money for retirement and in the long term would save the district money.Learn More
My friend Scott Dauenhauer wrote a great book. He is asking all fiduciary-minded financial advisers to take a look at servicing the public school educator market. He explains what you need to know and proceeds to show you in detail how to enter, grow and succeed in your private practice. As a public school teacher, my colleagues need you as the 403(b) market and teachers have been exploited, abused and monopolized for decades by the insurance industry. Public K-12 Educators are begging and screaming for advisers they can trust.Learn More