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Equitable Says It Appreciates Teachers 🤔

May 10, 2022

Just when you think nothing about the K-12 403(b) can surprise you, this appears during teacher appreciation week: Equitable Reinforces Commitment to America’s Teachers During Teacher Appreciation Week.

My first thought? This can't possibly be about that Equitable/AXA. That company is universally reviled in the 403bwise community for it's exhorbitantly priced 403(b) products and onerous surrender charges. Topic #1 in the 8,000 strong 403bwise Facebook Group is How do I get out of Equitable/AXA? Month-in-and-month-out the most read story on 403bwise is How to Get Out of AXA.

Being the trained academic and journalist that I am, I decided to give the "article" a fair shake. 

  1. I first checked to see if it came out on April 1st. Nope. 
  2. Next I checked to see if this was an Onion story. Darn.   
  3. Finally, I checked to see if this "article" was about a company called Equitable that actually cared about teachers. No dice. It's about that Equitable. 

Who Really Appreciates Teachers?

Consider the following scenario for two teachers, both age 22

  • Each earns $53,000
  • Each contributes $5,300 a year to a 403(b)
  • Each invests in the same type of investment
  • Each earns 7% annual return

By age 60...

  • One has saved $502,942
  • The other has saved $846,305 
  • Why is there such a big difference?

Fees. Fees. Fees.

  • The teacher who accumulated $502,942 invested in an Equitable Target 2045 Allocation fund that charges 2.3%
  • The teacher who accumulated $846,305 invested in a Fidelity Freedom Index 2045 Investor fund that charges 0.12% 

There's Gaslighting. And Then There's Equitable Gaslighting 

The "story" describing how much Equitable cares about educators includes the following... 

"Teachers have always been America’s unsung heroes, but especially in these unprecedented times they have shown great dedication, resilience and compassion through their ability to balance keeping their loved ones safe, healthy and engaged, without losing sight of the responsibility they have to protect their students and empower them to continue learning and growing in creative ways," said Jarian Kerekes, Head of Social Impact and Community Engagement at Equitable. 

Equitable Knows How Bad Their 403(b) Products Are

Even Equitable knows they have terrible K-12 403(b) products. How do I know this? The best they can say is that they are "the top provider" of K-12 403(b) plans: "As the top provider of 403(b) plans for K-12 schools, we’ve been committed to empowering the financial well-being of our nation’s teachers like Kurt and American families for more than a century," said Fred Makonnen, Divisional Vice President at Equitable. 

What Do Teachers Who Know Equitable Think About This "Article"?

From the 403bwise Facebook Group:

  • I think they left out the word “Screwing” in the middle of that headline.
  • Have they committed to charging even higher fees?
  • They've been losing so many teachers lately and had to put out a p.r. message.
  •  Puking emojis were a popular response 

Yahoo! and Warren Buffett Are Also Losers Here

It's embarrassing that Yahoo! Finance would publish this piece as news. What's just as bad? The company behind the article is something called "businesswire" a Berkshire-Hathway company. Yes, that Berkshire Hathway. Puke emoji. 

50 Million More Reasons Equitable's "Committment" to Teachers is a Sham

In its September 30, 2021 10-Q SEC filing, the company disclosed it was “cooperating with the U.S. Securities and Exchange Commission (the “SEC”) concerning the SEC’s investigation into the Company’s non-ERISA K-12 403(b) and 457 sales and disclosure practices.”

The Final Word

Perhaps "Ryan" said it best in the one comment to the article (before commenting was shut down): "This company is THE WORST and just rips off teachers by selling them AWFUL investment products."

Stay wise and well (and make Equitable the bottom provider of K-12 403(b) products)

Related Podcast:

50 Million More Reasons to Hate AXA/Equitable Firm has some explaining to do with the SEC.   Listen Now »