A new task force will develop transparency standards for 403(b) plans and a comparison tool that will give public school employees more information on their retirement plan options and costs.
ASPPA and the National Tax Sheltered Accounts Association, which represents 403(b) and 457 practitioners and employers, partnered with the Association of School Business Officials International and the National Education Association to create the 403(b) Transparency Task Force, which will develop national fee and service disclosure standards, including a model disclosure form that will allow apples-to-apples comparisons of 403(b) plan options, services and fees.
The group expects to have standards developed by the end of this year, and to roll out the comparison tool in early 2012.
“There’s been a lot of concern about the lack of simple and clear information available to public school employees” when making retirement decisions, Brian Graff, executive director and CEO of the American Society of Pension Professionals & Actuaries, said in an interview.
Unlike corporate employers, whose human resources staff are available to explain options and costs to employees, public schools typically rely on the service providers to educate school employees, “and we found there hasn’t been enough information about fees,” Mr. Graff said. Information on investment fees, in particular, is “hard to find or not even there,” he said.
Task force members are talking with school districts about possible beta testing later this year, and hope to roll out the comparison tool early next year. “We’re going to advocate that school districts require the comparison tools before they enter any contract,” Mr. Graff said.