Politics & Tactics
When I grow up, I want to be a retired firefighter!
Ok that may have not been your response to that timeless question. However about ten years into your career this answer will hold more relevance. Long nights away from your family, missed baseball games and birthdays. We have all sacrificed our time for the greater good with the hope to be able to retire with dignity. This was the promise for your dedication to your community.
Truth be told our system is under attack by those who will shake your hand with one hand and slash your budget with the other. Our political leaders are trying to trade that solemn promise for the latest talking point. We must stand together, get involved and participate in politics. Accountability starts with you! While you must stay engaged this fight will play out over the rest of your career. There are options that can put your family in a better position.
Deferred compensation is one why to guard and supplement your retirement. However many of our members invest in these plans without asking the right questions. In episode 188 our two special guests where Bobby Halton and
Tom Cama. Tom is a Financial Advisor for PlanMember Securities Corp Located in Carpentaria California. I was blown away by the positive response to our show and as promised the following is the back and forth from the episode.
The big questions our members need to know is how to evaluate the fees, the company and their rep? However lets start with the basics to get everybody on the same page.
It is a voluntary deferred contribution that allows a Fire Fighter the opportunity to save money tax deferred to supplement their pension and or other retirement plans. It is a Fire Fighters 401k…..
I have seen M&E fees vary from annual charges of 1/2 % to 1.35%. These fees go to the insurance company to pay their cost of doing business and for commissions. VA also usually has surrender charges applied to the accounts. They average 10 years with a 10% countdown 10, 9 8, 7,6,5,4,3,2,1, 0.
Mutual Funds do NOT have M&E Fees but due have Sale Charges. You can buy A, B or C shares. These shares describe the method of how sales charges are applied. A shares are usually around 4.5 to 5.5 % charges with no CDS, C shares usually have a 1% annual fee with a one year CDS. Both VA’s and M/F have fund charges applied to the accounts; this is how the managers at the fund companies get paid. All of this is described in the prospectus, that legal panflet you receive when you purchase these investments. I strongly recommend you read these books. As I have just given you a wide brush stock description of the two types of investments, the prospectus if very accurate. Hey it is your money you should now what’s going on.
Maybe your advisor is suggesting making changes monthly quarterly annually? But on what criteria are these changes being made?
Are they making sure that the fund managers that were in place when you signed on are still in charge?
Are they checking to see if the fund collection does not have an equity over lap?
Are they rebalancing your account? Some funds do this automatically?
If you have any questions check out the archived show or give Tom a call. Special thanks to John Norman for the title of this blog. Next episode we will be covering the difference between defined contribution verses defined benefit and the taking points how to maintain a DB plan for all your members. We will be asking Tom back! On behalf of Anthony Avillo and Chris Pepler we hope to have you call in! Until next time be safe,
Cama Financial Advisors
250 State Street Unit K1
North Haven, CT 06473
Tel. 203 824-2022