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Any FIREd folks use TIAA-CREF?
Old 07-01-2015, 01:15 PM   #1
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Any FIREd folks use TIAA-CREF?

I have a question about using TIAA-CREF long-term for my retirement portfolio after retirement (which looks like Jan. 2016!!!). I've heard folks tout the merits of Vanguard, Fidelity, and Schwab for that purpose, but no one talks much about TIAA-CREF.

TIAA-CREF currently holds about 1/2 my retirement portfolio (through my employer). I spoke with one of their advisors last week, who told me that if I were to transfer all my "outside holdings" to their firm, they would be happy to help me decide on an AA plan, income producing strategy, etc, at no charge (I'd have to actually do all the work myself, but with their advice/oversight). The TIAA-CREF advisor looked at all my outside holdings, and said everything could be transferred "in kind" initially (don't have to sell anything unless/until I want to as part of the AA plan, re-balancing, etc). He did tell me that some of the funds from one account could transfer in and be held, but that I'd no longer be able to re-invest the dividends into that same fund. He also disclosed that there might be of fee of $9.99 to sell some of the ETF funds in the outside portfolio eventually, but I don't need to do that right away. He also said TIAA-CREF would reimburse me for any/all "closing account" fees that the outside firms might charge me.

All in all, it sounds like a good deal. I plan on managing the account myself going forward, but definitely need some help to set everything up initially. I've not had much luck finding an FA willing to do that on an "hourly rate" basis - everyone pushes their "managed account" option. TIAA-CREF will do that essentially for free (as long as they hold all the assets, and I suppose eventually will get paid out of buying/selling commissions).

I've had my primary retirement account with them for >35 years, so I'm comfortable with them. Just wondered if there's anything I'm overlooking, or should ask about, before I commit to transferring my outside investments (including some Traditional and ROTH IRA accounts) there?
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Old 07-01-2015, 01:28 PM   #2
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TIAA was great until they brought in a CEO from Merrill Lynch. Now, not so much. I am happy to use them for insurance products, but I would not have my funds there. There are better and cheaper options.
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Old 07-01-2015, 01:43 PM   #3
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Thanks, brewer.

By "cheaper" options, what do you mean, exactly? The advisor I spoke with said I could continue to buy/hold ETF and other mutual funds outside of TIAA-CREF products, so I'm not limited to funds that TIAA-CREF manages. What other fees are you referring to?

THe only thing he did advise TIAA-related is the TIAA fixed (currently at "guaranteed 3%", but I believe that's the one that's not totally "liquid", as you have to withdraw it over a 10-year payout?), and the TIAA Real Estate fund, which has averaged better than 5% return for the past 10 years, including the "slump" in 2007-2010 ....
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Old 07-01-2015, 01:59 PM   #4
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I mean that you get cheaper commissions and a wider variety of options at other shops (especially the big 3). Ifyou have significant assets, you usually also get better service.
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Old 07-01-2015, 02:43 PM   #5
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To what Brewer said. Look at the cost of ownership for TIAA-CREF funds. Even if you go outside you will not find all funds or ETFs available from TIAA-CREF for $0 fees. You will pay more. Go to the big 3 and keep your money for ER.
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Old 07-01-2015, 02:48 PM   #6
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I have used TIAA-CREF for 30 years. I only use them for a portion of my retirement savings because they are not all that good when it comes to investments.

I only use 2 funds at TIAA which are unique: TIAA traditional annuity and the TIAA Real Estate Account. For all equity and bond fund investments I use Vanguard index funds and Fidelity index funds because they have lower expense ratios, better customer service, and better choices.

TIAA traditional annuity: It is like a stable value fund, but the interest rate paid depends on when you put the money in. It has limited liquidity because (at least for the vintages that I own), I cannot remove them all at once.

TIAA Real estate account: This investment owns commercial property such as big buildings and does have a REIT component. It does not track REITs though and has a very smooth change in value that is somewhat artificial and lags a commercial property index by about 9 months, so it can be market-timed on huge market movements.

TIAA-CREF was the bee's knees in the 50's, 60's, 70's before the no-load mutual fund industry took off and before there were index funds that were low-expense ratio and passively-managed. Not so much in 2010's.
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Old 07-01-2015, 03:10 PM   #7
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I am like LOL! in that I have some retirement money from my academic career at TIAA in Traditional and in Real Estate. Both of these have been excellent performers in my estimation as part of an employeer sponsored retirement plan. I would not move any money to TIAA from Fido, Vanguard or other discount broker. I just don't see any upside at all. TIAA does have some Wealth Management Advisors who will give you a boilerplate asset allocation which you can get on-line using there retirement income planner.

I understand that TIAA Traditional, outside of an employer retirement plan, does not have the 3% guaranteed rate.
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Old 07-06-2015, 12:47 PM   #8
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IIRC The expense ratio on my CREF stock funds has been in the 0.5% range. Most index funds at Vanguard have much lower expense ratios at around 0.17%. Admiral shares can be really cheap. The expense ratio for VTSAX (total world) is only 0.05%.

Now, if you are interested in buying some of the TIAA annuity products down the road, staying with them can make sense. And I can understand the desire to keep it simple by getting all of your money into a single account at one broker. Just note that you will be indirectly paying TIAA-CREF for their advice in the form of higher fund fees.
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Old 07-06-2015, 06:28 PM   #9
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Quote:
Originally Posted by LOL! View Post
I have used TIAA-CREF for 30 years. I only use them for a portion of my retirement savings because they are not all that good when it comes to investments.

I only use 2 funds at TIAA which are unique: TIAA traditional annuity and the TIAA Real Estate Account. For all equity and bond fund investments I use Vanguard index funds and Fidelity index funds because they have lower expense ratios, better customer service, and better choices.

TIAA traditional annuity: It is like a stable value fund, but the interest rate paid depends on when you put the money in. It has limited liquidity because (at least for the vintages that I own), I cannot remove them all at once.

TIAA Real estate account: This investment owns commercial property such as big buildings and does have a REIT component. It does not track REITs though and has a very smooth change in value that is somewhat artificial and lags a commercial property index by about 9 months, so it can be market-timed on huge market movements.

TIAA-CREF was the bee's knees in the 50's, 60's, 70's before the no-load mutual fund industry took off and before there were index funds that were low-expense ratio and passively-managed. Not so much in 2010's.

Everything Lol says is right on. Load up on trad and trea. Trad is a snail with has both deflation and inflation protection/upside. Compare a 20 yr chart of trea (don't know exact symbol) and plot versus IYR on Morningstar. See anything interesting?
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Old 07-08-2015, 09:26 PM   #10
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DH has all his holdings in TIAA-CREF from his 30 year academic career. Can't get him to change, so I live with it. The advisor we currently have is awful, doesn't get back to us, can't explain things. My retirement money is elsewhere.

The advisor wanted me to move some of my IRA to TIAA-CREF but then couldn't answer basic questions about the portfolio he wanted to set up. Needless to say I did not go with this idea.

Plus they have screwed up DH's RMD 3 years in a row.

Not a fan.


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