Shift to Wealth | Issue 5
What to Do With What You Learned in Issue 3
Issue 3 showed you the math. A 1% fee difference doesn't look like much until you run it across 25 years and watch it pull two million dollars off a retirement account. If that issue landed the way I intended, you walked away knowing fees are a real problem and wanting to do something about it.
This issue is what to do about it. Specific to your plan, specific to the funds available to you, specific enough that you can open nrsforu.com right now and make a change that will compound in your favor for the rest of your career.
Where You Probably Are Right Now
Most Fort Lauderdale members land in one of three places after enrollment.
A target date fund. These are named by retirement year — Nationwide Destination 2040, Nationwide Destination 2045, and so on. The fund shifts from aggressive to conservative automatically as that year approaches. If you're in one and the year is roughly right for when you plan to retire, this is a reasonable default. The problem isn't the strategy, it's the price tag.
A stable value fund. The Morley Stable Value fund in your lineup has returned 2.20% over the last year and 1.48% annualized over 10 years. It does not lose money. It also barely grows. For someone with 10 to 20 years before retirement, parking long-term money here is not safety. It's guaranteed underperformance dressed up as caution.
A money market fund. The Nationwide Government Money Market in your lineup is earning around 3.45% right now. That number drops when rates drop. For an emergency fund, fine. For retirement savings with a decade of runway, wrong account.
If you've been in a stable value or money market fund since enrollment and never touched it, you haven't been playing it safe. You've been leaving real growth on the table for years without knowing it. That's not a character flaw — nobody told you. Now somebody is.
The Pro Account
If you logged in and noticed your account is labeled something like professionally managed, or you see a program fee in your account details, you're in the Nationwide managed account tier. The rep at orientation made it sound like someone was actively watching your money and adjusting it. That was more or less accurate.
What wasn't explained is what that service costs.
The managed account program charges 0.65% per year on your first $100,000, on top of whatever the underlying fund charges. That fee doesn't show up as a line item on your statement. It gets pulled out of your return before the number you see is calculated. You never see an invoice. The money just quietly leaves.
Here's what members in the managed account are actually paying all-in:
Fund | Fund Expense Ratio | Program Fee | Total Annual Cost |
|---|---|---|---|
Nationwide Destination 2040 | 0.71% | 0.65% | 1.36% |
Nationwide Destination 2045 | 0.71% | 0.65% | 1.36% |
Nationwide Destination 2050 | 0.71% | 0.65% | 1.36% |
Nationwide Investor Destinations Aggressive | 0.90% | 0.65% | 1.55% |
Nationwide S&P 500 Index Fund | 0.43% | 0.65% | 1.08% |
Vanguard 500 Index — Admiral Shares (in plan) | 0.04% | 0.65% | 0.69% |
Look at that last row. The Vanguard 500 Index Admiral fund in your plan tracks the S&P 500 and charges 0.04% to run. Even with the 0.65% program fee stacked on top, you're at 0.69% total — half what the target date fund costs you inside the same program.
If you opt out of the managed account entirely and hold that same Vanguard fund on your own, your total cost drops to 0.04%.
That is the full spread Issue 3 was describing, sitting right inside your existing plan. No new accounts. No transfers. Just two changes on a website most members have never opened.
The Two Moves
First, change your fund. Log into nrsforu.com, go to your account, find your current allocation, and move it to the Vanguard 500 Index — Admiral Shares. The plan also has a Vanguard Mid-Cap Index and Vanguard Small-Cap Index at similarly low expense ratios. But the 500 Index alone covers the 500 largest companies in the US economy. For most members at most career stages, that is a well-diversified place to be and it costs next to nothing to hold.
Second, opt out of the managed account if you're in it. This is often a separate step from changing your fund, switching funds does not automatically remove the program fee. Check your account settings under investment options or managed account enrollment, or call the plan directly at 1-800-701-8255 and ask them to confirm whether you're still enrolled in the professional management program after your fund change. If you are, ask them to walk you through opting out.
Two changes. One website. Most members have never made either one.
What You're Not Giving Up
Moving out of a target date fund and into an index fund is not moving from safe to risky. Both hold stocks. The target date fund holds a mix of stocks and bonds that shifts over time. The Vanguard 500 Index holds stocks. At 20 years from retirement the difference between those two is not meaningful in terms of risk — it's meaningful in terms of cost. You're paying 1.36% for a managed version of something you can hold for 0.04%.
The managed account is not useless for every person in every situation. A member who genuinely has no interest in looking at the account, cannot sit through a down year without panic-selling, and needs someone else handling the allocation — the 0.65% program fee may be worth something to him. That is a real service with a real cost. But it should be a choice, not a default that ran for fifteen years without anyone explaining what it was.
Now you can make that call on purpose.
Run Your Own Numbers First
The tables in this issue use real fund data, but they don't use your balance and your contribution rate. Issue 3 introduced the idea of running your holdings through an AI tool to see the fee picture clearly. This is the same move, but more specific — because now you know exactly which plan you're in and what the comparison fund costs.
Log into nrsforu.com and download your account statement. You're looking for your current fund name, your current balance, your biweekly contribution amount, and your total expense ratio including any program fee. Most of that is on the account summary page. Screenshot it or download the PDF statement from the documents tab.
Then open an AI tool — Claude, ChatGPT, whatever you use — paste in what you found, and ask it these four questions:
Based on my current fund and expense ratio, how much am I paying in fees annually in dollars?
How has my current fund performed compared to the S&P 500 over the last 1, 5, and 10 years?
If I keep contributing my current biweekly amount for the years I have left until retirement, what is the projected difference in ending balance between my current fund and the Vanguard 500 Index Admiral fund at 0.04%?
What does that difference compound to if I also eliminate the 0.65% managed account program fee?
What comes back will be more useful than anything in this newsletter because it will have your name on it. The fee drag is the same math regardless of whose account it runs on — but seeing it in your numbers, on your timeline, with your contributions, lands differently than a table built around a hypothetical firefighter.
If the numbers don't bother you, you have your answer. If they do, you know what to do next.
This Issue's Action Step
Log into nrsforu.com. Download your statement. Run the four questions above through an AI tool with your actual numbers.
If you're in a stable value or money market fund, move your allocation to the Vanguard 500 Index — Admiral Shares.
If you're in the managed account and the AI exercise showed you a number that bothered you, make the two changes: switch the fund and opt out of the program. Call 1-800-701-8255 if you need help confirming the opt-out is complete.
If you're already in a low-cost self-directed fund, you're ahead of most members on this job. Keep reading.
Talk soon.
If this was useful, forward it to someone at the station who should be thinking about this stuff. Or just hit reply and let me know what you want covered next.
Written by a firefighter currently in DROP, sharing what I've found useful along the way. This is education, not financial advice. Fund expense ratios, program fees, and plan options referenced are specific to the Nationwide plan as of publication and may change. Confirm your current fund costs and program fee structure at nrsforu.com or by calling your plan administrator before making any changes. Talk to a fiduciary advisor before making decisions specific to your situation.