The “first ever transparency standards for disclosure of fees and services in the public school 403(b) marketplace,” were launched Feb. 1 by partners of the 403(b) Transparency Taskforce, which include the National Education Association (NEA), the National Tax Sheltered Accounts Association (NTSAA) and The American Society of Pension Professionals & Actuaries (ASPPA).
The issue of better disclosure of fees and investment options is a mutual concern in the private and public-sector retirement plan industry, particularly due to increased government regulation. But there is at least one key distinction between such plans, according to an ASPPA press release: “Public school 403(b) plans are fundamentally different from 401(k) plans since participants don’t receive the same disclosure or protections.” This lack of disclosure protection can be problematic because “Public school 403(b) plans are a crucial part of public education employee retirement plans and often the largest retirement asset over which they have complete control,” according to ASPPA.
Accordingly, the Taskforce developed the 403(b) Model Disclosure Form to provide teachers and other school district staff with “a simple uniform tool to make apples-to-apples comparisons among their 403(b) retirement plan investment options” and to provide “simple and clear information” about plan services and fees.
“Transparency benefits everyone in the 403(b) marketplace — that’s why we urge adoption of the 403(b) model disclosure form by public schools throughout the country,” said Brian Graff, ASPPA’s executive director and CEO.
“NEA believes this disclosure tool will offer clear information for teachers and education support professionals to evaluate the 403(b) options offered by their employers and to make informed retirement planning decisions,” said Gary Phoebus, president and CEO of NEA’s Member Benefits Corporation.
The model disclosure form will be discussed at the NTSAA 403(b) Advisor Summit on Feb. 8-10, 2012 in Las Vegas and during a Feb. 28 NTSAA-sponsored webcast. In addition, the form, and detailed instructions on how to use it provided by key industry insiders, will be found in The 403(b)/457 Plan Requirements Handbook, published by Thompson Publishing Group.