How are employers “help employees reach their retirement goals” if you decided in retrospect that it would have been better if you opted out?I have also never worked alongside a fellow Boglehead. It's amazing to me the level of (financial) ineptness that I see amongst my fellow non-bogle colleagues. You can lead a horse to water....
Anyways, I'd like to do a follow-up on my decision to opt into the MBCBP. After a few months in, I am finding a few things to be not quite as advertised.
Firstly, it is incredibly difficult to track the funds going into my MBCBP. There is no record of excess funds on my pay stub and so I have to do some high level math to calculate what should actually be deposited to the MBCBP plan. My company claims that they can't put a line on our paycheck because they don't do the computations. Fidelity manages the computations but they have no have no way to make a line on our paycheck.
Secondly, the deposit to the MBCBP comes from the previous month's 2 paychecks. So the funds aren't visible at Fidelity until the following month on the 15th. Although the funds are in the market, I have zero ability to view those funds until the 15th of the following month.
Thirdly, the MBCBP isn't visible on the Fidelity app. Although Fidelity displays a line for MBCBP on my account, it shows zero balance even though I have thousands in that account. I have to login to NetBenefits separately to see the balance. I prefer to see all my accounts in one central location especially for my wife in case anything happens to me. So this is a bit of a disappointment. Also, the multiple fund locations makes it that much more difficult to keep a close eye on my total asset allocation for my entire portfolio.
Finally, there is very little transparency as to where those MBCBP funds are invested. Just a very broad 40/60 equity to bond allocation for the MBCBP.
If I had to do it over again, I'd opt out of the plan. The tax advantaged nature of the MBCBP is definitely a benefit, but the overall lack of transparency doesn't make the tax savings worthwhile for me. In retrospect, I'd prefer to simply put excess funds into a taxable brokerage account, pay the taxes, and have completed control of my money. Unfortunately, now I'm stuck with the plan until I'm 59½ since it is a one time opt in.
I'm guessing these MBCB plans are going to become more common in the workplace as companies look for ways to help employees reach their retirement goals. Hopefully my comments help someone else with their decision with regards to the MBCBP.
Statistics: Posted by anoop — Sat Jan 06, 2024 1:39 am — Replies 22 — Views 3433