Why We Are Not Giving You a List of Funds
Every California school district negotiates its own 403(b) vendor list. What is available to a teacher in Ventura County may not be available to a teacher in Sacramento. Rather than naming specific funds — which would be meaningless for most readers and inappropriate as a blanket recommendation — this page walks through how to evaluate whatever is actually sitting on your own vendor list.
Step One: Identify the Product Type
Confirm whether each option on your vendor list is a 403(b)(7) mutual fund custodial account or a 403(b)(1) annuity contract. This single distinction usually explains most of the cost difference between your options. See our full breakdown of 403(b) annuities and fees →
Step Two: Compare Total Expense Ratios, Not Headline Names
A fund family name (Fidelity, Vanguard, TIAA) tells you almost nothing on its own — the same provider can offer both a low-cost index fund and a high-cost variable annuity. Pull the actual expense ratio for each option, including any wrap fees or administrative charges layered on by the plan itself, and compare that number directly against the other options on your list.
Step Three: Understand What a Target-Date Fund Is Doing
If your vendor list includes a target-date fund (often labeled with a year, like "2050"), it automatically shifts its mix of stocks and bonds to become more conservative as that year approaches. These are frequently used as default options and can be a reasonable single-fund choice — but confirm the expense ratio, since target-date funds vary in cost just like any other option.
Step Four: Weigh It Against Your Pension
Because your CalSTRS pension already provides a source of guaranteed lifetime income, how you invest your 403(b) does not need to replicate that guarantee. Many teachers can reasonably carry more growth-oriented investments in their 403(b) than they would if it were their only retirement asset, precisely because the pension is covering the "guaranteed" side of the equation. This is a personal decision that depends on your full financial picture, tier, and timeline — not something a general article can answer for you.
This page is educational, not personalized investment advice. What belongs in your 403(b) depends on your specific vendor options, your risk tolerance, your pension tier, and your timeline to retirement.