It's important to note there are some key differences between the existing providers and the new providers. The current providers (Horace Mann, MassMutual, VALIC, Voya) have been vetted through a stringent request for proposal process. In addition, the providers and their underlying investments are reviewed annually by RIC and an outside investment consultant to determine fund performance and objectives, management stability and fund diversity. Additionally, RIC has negotiated lower fees and expenses on behalf of participants, and there are no sales charges, annual contract fees, fund transfer fees or restrictions/penalties for eligible distributions and exchanges between the providers.
The new providers being added July 1, 2018, have not been subjected to the same vetting process. Rather, the providers have met a few basic requirements to participate in RIC. There are no restrictions on the administrative fees/sales commissions that may be charged. Financial consultants may be inclined to sell investments with these new providers because the consultants receive higher sales commissions from them.
This At-A-Glance document gives you a high-level summary of all the 403(b) investment providers. If you are interested in using one of the new investment providers, you will need to complete a 403(b) Salary Reduction Form for payroll deductions beginning July 1, 2018, as well as open an account with your chosen provider. If you’d like to learn more about the 403(b) program, visit the RIC’s website.
If you have any questions, contact Steve Jordan, Senior Payroll Specialist, at ext. 14908.
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