Originally Posted by
notEnuf
The 10 year annualized return was 4.35% for LIRIX. (institutional shares) You can add 1.85% directly to that number so your return would be 6.2%, which isn't S&P level returns but pretty good given the low level of risk and the capital preservation guarantee. Like I said I'm in and will reap the returns on 100% tax advantaged money as this plan become the conservative element in my total portfolio.
https://www.blackrock.com/us/individ...rtinst-cl-fund
I know you’re smarter than this, but the 1.85% is a one-time savings, not an annualized return. The simple math that you posited is not connected to reality. For someone with 30 years, to even make a rough estimate, I would need to divide 1.85% by 30 which gives an annualized .061% savings; using you’re example would give something close to a 4.41% return on the MBCBP. Essentially negligible.
However, if you’re close to the 59.5 in-service withdrawal eligibility then maybe the 1.85% is a bigger share of what returns you have left. For those of us with more than 5 years to that age, there’s no way we can add that 1.85% as an annualized return.