Author Topic: 457 Requires Finacial Advisor?  (Read 1153 times)

Xlar

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457 Requires Finacial Advisor?
« on: December 12, 2017, 11:27:28 AM »
My wife has access to both a 403b and a 457 through work as she is a teacher. We were able to open the 403b without too many difficulties, just lots of paper forms... For the 457 we filled out the paperwork but they have come back and said that the form requires a Financial Advisor's signature to show that they have approved it. WTF? Is this normal? They have a list of recommended financial advisors but I'd rather not pay to get them to sign a form. Plus it seems that I would have to pay to get them to sign every time that I want to increase the contribution amount, i.e. every year when the IRS increases the limit...

Let me know what you guys think, is this something I should go along with or try to fight?

Xlar

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Re: 457 Requires Finacial Advisor?
« Reply #1 on: December 12, 2017, 12:08:27 PM »
Can she just put own signature and indicate "self-managed" on the form.  Chances are good no one checks anyhow.

That's a good thought. They checked enough to make sure the form was filled in but maybe they wouldn't care as long as it's signed by someone. Since they just specified financial advisor which is a very general term, I guess anyone could call themselves a financial advisor, hahaha.

MDM

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Re: 457 Requires Finacial Advisor?
« Reply #2 on: December 12, 2017, 12:41:10 PM »
Is this normal?
...is this something I should go along with or try to fight?
No, definitely not normal.  Perhaps not even legal, although "avoiding lawsuits in case the 457 investments lose money" may have been the school district's motivation for including it.

As long as there is nothing there about the signer being an advisor licensed by the state (in other words, don't do something illegal), then either her own signature or your signature - she doesn't have to take your advice ;) - seems worth doing.

hadabeardonce

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Re: 457 Requires Finacial Advisor?
« Reply #3 on: December 12, 2017, 02:13:20 PM »
The California school district I work for offers nine 403b and three 457 vendors. Many are managed, very few are self-managed. You can always ask your HR department to pursue different vendors.

It took me a while to figure out that my 457 has a SDBA option which opens up access to investing in way more funds. Speak with your payroll department, you can learn a lot from just chit chatting with them, like which vendors are most popular.

facepalm

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Re: 457 Requires Finacial Advisor?
« Reply #4 on: December 12, 2017, 06:21:05 PM »
Your wife needs to find out who her plan administrator is. Small districts often self manage, but the larger districts hire an administrator since paperwork requirements can be huge. If the district is managing her 457/403 plans, she should speak directly with that person--more than likely someone in HR or the business office. I'd ask them why they have the requirement, and I would ask where in the districts plan documentation it specifies that. I would want to see the actual document. If they can't point to the document and show where it is required, then they can't require it.

If her district uses a third party administrator, you have to get in touch with them directly and pester them.

In the long run, it may be of no avail--you may just have to pay someone to certify your doc. But once you have the account set up contribution changes should not require additional signatures.

I'm a teacher, and have both a 403(b) and a 457(b) with my district, and go through a third party administrator.

Bashdash

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Re: 457 Requires Finacial Advisor?
« Reply #5 on: December 13, 2017, 06:15:04 PM »
403bwise.com is your friend.   Their discussion board has 403b 457 experts.