TIAA-CREF (Ugggh!)

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TIAA-CREF (Ugggh!)

Postby nick22 » Sat May 09, 2009 8:07 am

It is now becoming sadder by the day that TIAA-CREF is my only choice for my pension and 403(b) plans. I have them for the past 2 years and in that time they have increased the expense rations on their index funds, levered up their RE account just before the real estate crash, and now they are taking away my SCV fund choice. I just received a letter that they are merging all SCV accounts into the SCB fund to "simplify" things. So all of my SCV holdings will be moved on June 2nd into SCB. I do not recall Fama/French using SCB in their analysis, and this is a major disruption to my AA not to have SCV available for my pension account or 403b.

To maintain my AA, I will essentially have to completely reconfigure my IRA accounts, and revisit my future plan since I will not have SCV (and never had EM) available at TIAA-CREF.
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Postby Boglenaut » Sat May 09, 2009 9:10 am

I am a TIAA-CREF prisoner as well from a previous job.

At least a fund ER I am in dropped slightly, but it is still 2.5X the equivelent Vanguard fund.

They won't let me roll it over.
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Postby House Blend » Sun May 10, 2009 8:40 am

FYI, here's an earlier thread about this you may have missed
http://www.bogleheads.org/forum/viewtopic.php?t=36750
You should have been notified about this last year in a supplement to the prospectus. I classify this not as "bad news", but "bad old news".

As Boglenaut mentioned, there is actually a tiny bit of good new news--the ER's on the two Bond VA's dropped a few bp to 0.50 recently.
http://www.bogleheads.org/forum/viewtopic.php?t=37159

Have fun reconfiguring your portfolio. :x
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Thanks

Postby nick22 » Sun May 10, 2009 11:12 am

Thanks. Whether or not it is old news, the impending merger date is upon us (June 2nd) and so this is the time I now must work on reshuffling my portfolio. A bit painful, as now my T-C holdings will be down to S&P index, Int. index and RE fund, and I will need to transfer much of my IRA to Vanguard from D&C and put it in the SCV fund, to maintain my allocation. A pseudo-house of cards that will require 5-6 transactions amongst my holdings to keep my AA the same.

I agree that T-C is fading from good/great to mediocre, and the trajectory is concerning.
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Merger date

Postby raywax » Sun May 10, 2009 1:01 pm

The merger date is June 12th; not June 2nd.
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Re: Thanks

Postby Boglenaut » Mon May 11, 2009 11:16 am

nick22 wrote:Thanks. Whether or not it is old news, the impending merger date is upon us (June 2nd) and so this is the time I now must work on reshuffling my portfolio. A bit painful, as now my T-C holdings will be down to S&P index, Int. index and RE fund, and I will need to transfer much of my IRA to Vanguard from D&C and put it in the SCV fund, to maintain my allocation. A pseudo-house of cards that will require 5-6 transactions amongst my holdings to keep my AA the same.

I agree that T-C is fading from good/great to mediocre, and the trajectory is concerning.


Hopefully, it'll be more like Musical Chairs... House of Cards implies it's all going to fall apart. ;)
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Postby sscritic » Mon May 11, 2009 12:31 pm

Where did you get your asset allocation? Did Moses bring it down from Mount Sinai along with the ten commandments?

My guess is that you will do more damage to your fixed asset allocation by changing your mind at some point in your life than will be done by your small cap becoming small blend. You also don't really know that small blend won't give you better results in the future than small cap.

My second guess is that the effect at retirement of using small blend rather than small cap will be less than the effect of foregoing one latte a day from now to retirement.

If you want to switch all your funds around, go for it. But do it with a smile! :D

In my case, I decided to go for simplicity. I too listened to all this small cap stuff around here and allocated some of my TC account to it. Of course it dropped like a stone, and is right there with all the other funds in three years performance (a great diversifier!). Instead of finding another small cap or going with small blend, I just added it to my Cref Stock. Plenty of old timers like me did just fine with only TIAA Traditional and Cref Stock, and it still isn't a bad way to go.
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Postby rr2 » Mon May 11, 2009 12:47 pm

sscritic wrote:
In my case, I decided to go for simplicity. I too listened to all this small cap stuff around here and allocated some of my TC account to it. Of course it dropped like a stone, and is right there with all the other funds in three years performance (a great diversifier!). Instead of finding another small cap or going with small blend, I just added it to my Cref Stock. Plenty of old timers like me did just fine with only TIAA Traditional and Cref Stock, and it still isn't a bad way to go.


Simplicity works. I also just have the TIAA Traditional and the CREF Stock. Hopefully it will work as well in the future as its past performance :).
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Postby DickBenson » Mon May 11, 2009 1:55 pm

sscritic wrote:Where did you get your asset allocation? Did Moses bring it down from Mount Sinai along with the ten commandments?

Plenty of old timers like me did just fine with only TIAA Traditional and Cref Stock, and it still isn't a bad way to go.


Amen.

IMO the "benefit" to participants of all these new stock funds simply has been an increase in expenses (for both Traditional and CREF Stock).

Look up Taylor's four fund recommendation.

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