Need Help With Allocation in Move to TIAA CREF

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Renaud
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Need Help With Allocation in Move to TIAA CREF

Post by Renaud » Wed Sep 18, 2013 7:27 pm

After numerous attempts to identify the cost of my Ameriprise investments I did the math. Wow, they are expensive. :oops: It seems the best alternative offered by my institution is TIAA CREF. It will work until retirement when I can switch to Vanguard.

I have about $450,000 to transfer. I have a retirement timeline of 5 years, (retiring at 67), and I am a moderately aggressive investor.

What TIAA CREF mutual funds would the wise recommend? What allocation offers some promise respectable growth and protection? Moving away from a financial advisor, one I trust and have depended upon, is a bit unnerving. Some type of reference points to identify possible investment mixes will help me narrow the field research and provide some confidence to make this leap into financial self direction.

Thank you, in advance, for suggestions.

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Dutch
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Re: Need Help With Allocation in Move to TIAA CREF

Post by Dutch » Wed Sep 18, 2013 10:53 pm

Is this a 403(b) / 401(a) account? If so, list the funds available in your plan.

Or is it an IRA ?

Valuethinker
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Re: Need Help With Allocation in Move to TIAA CREF

Post by Valuethinker » Thu Sep 19, 2013 2:06 am

Renaud wrote:After numerous attempts to identify the cost of my Ameriprise investments I did the math. Wow, they are expensive. :oops: It seems the best alternative offered by my institution is TIAA CREF. It will work until retirement when I can switch to Vanguard.

I have about $450,000 to transfer. I have a retirement timeline of 5 years, (retiring at 67), and I am a moderately aggressive investor.

What TIAA CREF mutual funds would the wise recommend? What allocation offers some promise respectable growth and protection? Moving away from a financial advisor, one I trust and have depended upon, is a bit unnerving. Some type of reference points to identify possible investment mixes will help me narrow the field research and provide some confidence to make this leap into financial self direction.

Thank you, in advance, for suggestions.
We would need to see funds and expense ratios. Also an entire portfolio picture laid out in the standard format used here.

Generally given 5 years to retirement I think you should be 50% in bonds: a mix of bond market, short term bond market and TIPS bonds. The remainder in equities 2/3rds US index 1/3rd international. There is a good case to be 60% in bonds.

Levett
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Re: Need Help With Allocation in Move to TIAA CREF

Post by Levett » Thu Sep 19, 2013 5:17 am

Renaud,

The $450K should get TIAAs attention and get you some personal service.

Here are two phone numbers I recommend you use: for Retirement Plans and IRA Enrollment (800-842-2888); for Wealth Management Services (866-842-3519).

I'd try to jump to the head of the line by calling Wealth Management Services first. The $450K is close to the lower bound of $500K for Wealth Management Services (the personnel are referred to as WMAs--Wealth Management Advisors). WMAs are salaried employees.

Also, you should check the TIAA website to see if an office is nearby. A sit-down would prove to be helpful, and it would provide you with a personal contact. Here's a link that you can use to find a local office. https://www.tiaa-cref.org/public/suppor ... t/regional

When and if you initiate a transfer, have TIAA (not Ameriprise) do the paperwork and start the ball rolling. You want a personal contact at TIAA to oversee the paperwork. I've done this before--on more than one occasion.

TIAA produces a lot of useful publications, including model portfolios, that may be of use to you as you match your needs against some suggested models.

Good luck!

Lev

The Wizard
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Re: Need Help With Allocation in Move to TIAA CREF

Post by The Wizard » Thu Sep 19, 2013 7:30 am

OP says the T-C connection is via his employer ("institution") so I would check with them (the benefits dept) to see how this transfer might work.
I'm heavily in T-C (403(b)) but all from paycheck contributions over 40 years, not a rollover from elsewhere.
Unclear if it's permissible to roll lumpsums into a 403(b).
There are advantages to having money in employer plans (GRAs and GSRAs) as opposed to individual (IRA): higher rates on TIAA Traditional and lower ERs on mutual funds.

Transferring your T-C accum to VG down the road may or may not be a good idea, but you'll have time to figure it out. While VG definitely has lower ER's on every comparable fund, T-C funds sometimes out-perform VG, net of expenses.
And VG has nothing to compare with Trad or TREA.

We can discuss particular funds in the T-C family once the OP gets back to us...
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Topic Author
Renaud
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Re: Need Help With Allocation in Move to TIAA CREF

Post by Renaud » Thu Sep 19, 2013 7:41 am

Thank you for the quick replies. Frankly, I am stunned, impressed and delighted.

I did drop the ball neglecting to state it is a 403(b). My annual contribution is maxed out. I also contribute the maximum to a Roth IRA with Vanguard, and contribute the same about as the IRA to a 457.

The available TIAA CREF funds that caught my eye are:

TIQRX - TIAA-CREF Equity Index- 0.32% operating expenses
TRGIX - TIAA-CREF Growth & Income- 0.71% operating expenses
TRIEX - TIAA-CREF International Equity Index Fund- 0.33% operating expenses
TRCVX - TIAA-CREF Large-Cap Value Index Fund- 0.32% operating expenses
TRIRX - Large-Cap Growth Index Fund- 0.32% operating expenses
TRGMX - TIAA-CREF Mid-Cap Growth Fund- 0.73% operating expenses
TRSPX - TIAA-CREF S&P 500 Index Fund- 0.32% operating expenses
TRBIX - TIAA-CREF Small-Cap Blend Index Fund- 0.40% operating expenses
TCLTX - TIAA-CREF Lifecycle 2020 Fund- 0.69% operating expenses

However, the full mix of funds available to me are the follwoing:

EQUITIES

TIAA-CREF Emerging Markets Equity Fund -- TEMSX
TIAA-CREF Emerging Markets Equity Index Fund -- TEQSX
TIAA-CREF Equity Index Fund -- TIQRX
TIAA-CREF Global Natural Resources Fund --TNRRX
TIAA-CREF Growth & Income Fund -- TRGIX
TIAA-CREF International Equity Fund -- TRERX
TIAA-CREF International Equity Index Fund -- TRIEX
TIAA-CREF Large-Cap Growth Fund -- TILRX
TIAA-CREF Large-Cap Growth Index Fund -- TRIRX
TIAA-CREF Large-Cap Value Fund – TRLCX
TIAA-CREF Large-Cap Value Index Fund -- TRCVX
TIAA-CREF Mid-Cap Growth Fund -- TRGMX
TIAA-CREF Mid-Cap Value Fund -- TRVRX
TIAA-CREF Real Estate Securities Fund -- TRRSX
TIAA-CREF S&P 500 Index Fund -- TRSPX
TIAA-CREF Small-Cap Blend Index Fund -- TRBIX
TIAA-CREF Small-Cap Equity Fund – TRSEX
TIAA-CREF Social Choice Equity Fund -- TRSCX

FIXED INCOME

TIAA-CREF Bond Fund -- TIDRX
TIAA-CREF Bond Index Fund -- TBIRX
TIAA-CREF Bond Plus Fund -- TCBRX
TIAA-CREF High-Yield Fund -- TIHRX
TIAA-CREF Inflation-Linked Bond Fund -- TIKRX
TIAA-CREF Short-Term Bond Fund -- TISRX

MONEY MARKET

TIAA-CREF Money Market Fund -- TIEXX

MULTI-ASSET

TIAA-CREF Lifecycle 2010 Fund -- TCLEX
TIAA-CREF Lifecycle 2015 Fund -- TCLIX
TIAA-CREF Lifecycle 2020 Fund -- TCLTX
TIAA-CREF Lifecycle 2025 Fund -- TCLFX
TIAA-CREF Lifecycle 2030 Fund -- TCLNX
TIAA-CREF Lifecycle 2035 Fund -- TCLRX
TIAA-CREF Lifecycle 2040 Fund -- TCLOX
TIAA-CREF Lifecycle 2045 Fund -- TTFRX
TIAA-CREF Lifecycle 2050 Fund -- TLFRX
TIAA-CREF Lifecycle 2055 Fund -- TTRPX
TIAA-CREF Lifecycle Retirement Income Fund -- TLIRX

I will look into the WMA approach. As for going with 50-60% bonds, I worry that bonds will take a beating once "tapering" begins. Five years is not much time, but I do have the option of going for full SSA retirement in 7 years. Ouch, typing that hurts!

The Wizard
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Re: Need Help With Allocation in Move to TIAA CREF

Post by The Wizard » Thu Sep 19, 2013 7:57 am

You have an excellent menu of funds available in your 403(b), way more than I (and some others) had, due to variations between employers.
You undoubtedly also have access to TIAA Traditional (Trad) and probably TIAA Real Estate Account (TREA).
For now, avoid most of the bond funds and put $$ into Trad at 3.0% or higher. Trad in a GSRA is liquid; in a GRA it pays more but is semi-liquid.
Their mutual funds tend to have better performance than their variable annuities: I like the mid-cap/small-cap funds and also have some in international equity.
Many folks also have considerable percentage in TREA which has been discussed in other threads, both here and on M*...
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House Blend
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Re: Need Help With Allocation in Move to TIAA CREF

Post by House Blend » Thu Sep 19, 2013 12:43 pm

Renaud,

Don't put a dime into TIAA Traditional (assuming the possibility--quite doubtable--that you have access to it), until you understand the restrictions on transfers that apply to your particular flavor(s) of Traditional.

If you blindly dump money into it because some knucklehead on the internet told you to do so, you may discover that there are obstacles in the way of your plan to consolidate everything at Vanguard at retirement.

P.S. I too am a knucklehead.

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jjustice
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Re: Need Help With Allocation in Move to TIAA CREF

Post by jjustice » Thu Sep 19, 2013 12:57 pm

Wizard fits better into the "wise" who were solicited by the OP than into the knuckleheads.

This knucklehead is puzzled by the list of available funds. Are none of TIAA-CREF's distinctive and valuable annuity accounts available? Wizard's suggestion was for a couple of these, but not one of the annuity accounts appears on the lists. TIAA-CREF is more experienced as an annuity provider than as a mutual fund company. They came to the mutual fund business rather late (1999, edited).

John
Last edited by jjustice on Thu Sep 19, 2013 1:10 pm, edited 2 times in total.

The Wizard
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Re: Need Help With Allocation in Move to TIAA CREF

Post by The Wizard » Thu Sep 19, 2013 12:59 pm

House Blend wrote:Renaud,

Don't put a dime into TIAA Traditional (assuming the possibility--quite doubtable--that you have access to it), until you understand the restrictions on transfers that apply to your particular flavor(s) of Traditional.

If you blindly dump money into it because some knucklehead on the internet told you to do so, you may discover that there are obstacles in the way of your plan to consolidate everything at Vanguard at retirement.

P.S. I too am a knucklehead.
Yes, this is the "semi-liquid" issue I mentioned above for GRAs. Can take up to 9 years and a day to withdraw/transfer all Trad from a GRA.
Hence, open a GSRA ("supplemental") and hold Trad there for rebalancing purposes.

And I find it difficult to imagine a 403(b) plan at T-C that does not offer access to TIAA Traditional, it being their cornerstone product...
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raywax
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Re: Need Help With Allocation in Move to TIAA CREF

Post by raywax » Thu Sep 19, 2013 5:49 pm

The Wizard wrote:
House Blend wrote:Renaud,

Don't put a dime into TIAA Traditional (assuming the possibility--quite doubtable--that you have access to it), until you understand the restrictions on transfers that apply to your particular flavor(s) of Traditional.

If you blindly dump money into it because some knucklehead on the internet told you to do so, you may discover that there are obstacles in the way of your plan to consolidate everything at Vanguard at retirement.

P.S. I too am a knucklehead.
Yes, this is the "semi-liquid" issue I mentioned above for GRAs. Can take up to 9 years and a day to withdraw/transfer all Trad from a GRA.
Hence, open a GSRA ("supplemental") and hold Trad there for rebalancing purposes.

And I find it difficult to imagine a 403(b) plan at T-C that does not offer access to TIAA Traditional, it being their cornerstone product...
Wizard may be mistaken about the lock-in interval for a GRA; what he quotes, 9 years and 1 day is the interval for an investment in the TIAA Traditional Account in an RA; not a GRA. I never had the latter but I think it's locked interval is shorter; however, this is just from memory and I could be wrong.

Ray

DickBenson
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Re: Need Help With Allocation in Move to TIAA CREF

Post by DickBenson » Fri Sep 20, 2013 2:07 am

The following is from the TIAA-CREF site.
For Group Retirement Annuity (GRA) contracts and subject to the terms of your employer's plan, lump-sum withdrawals are available from the TIAA Traditional Annuity only within 120 days after termination of employment and are subject to a 2.5% surrender charge. All other withdrawals and transfers from the account must be spread over ten annual installments (over five years for withdrawals after termination of employment).
There is a third Traditional contract, Retirement Choice, where withdrawals and transfers from the account must be made over 7 years (84 monthly payments) or lump sum within 120 days after termination of employment with a 2.5% surrender charge. This contract also has a vintage rate structure that is different than that of the RA and GRA contracts.

Note that the SRA, GSRA and RCP supplementary contracts (associated with each of the 3 types of Traditional contracts) have no withdraw restrictions.

Dick

Valuethinker
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Re: Need Help With Allocation in Move to TIAA CREF

Post by Valuethinker » Fri Sep 20, 2013 10:35 am

Renaud wrote:Thank you for the quick replies. Frankly, I am stunned, impressed and delighted.

I did drop the ball neglecting to state it is a 403(b). My annual contribution is maxed out. I also contribute the maximum to a Roth IRA with Vanguard, and contribute the same about as the IRA to a 457.

The available TIAA CREF funds that caught my eye are:

TIQRX - TIAA-CREF Equity Index- 0.32% operating expenses
TRGIX - TIAA-CREF Growth & Income- 0.71% operating expenses
TRIEX - TIAA-CREF International Equity Index Fund- 0.33% operating expenses
TRCVX - TIAA-CREF Large-Cap Value Index Fund- 0.32% operating expenses
TRIRX - Large-Cap Growth Index Fund- 0.32% operating expenses
TRGMX - TIAA-CREF Mid-Cap Growth Fund- 0.73% operating expenses
TRSPX - TIAA-CREF S&P 500 Index Fund- 0.32% operating expenses
TRBIX - TIAA-CREF Small-Cap Blend Index Fund- 0.40% operating expenses
TCLTX - TIAA-CREF Lifecycle 2020 Fund- 0.69% operating expenses

However, the full mix of funds available to me are the follwoing:

EQUITIES

TIAA-CREF Emerging Markets Equity Fund -- TEMSX
TIAA-CREF Emerging Markets Equity Index Fund -- TEQSX
TIAA-CREF Equity Index Fund -- TIQRX
TIAA-CREF Global Natural Resources Fund --TNRRX
TIAA-CREF Growth & Income Fund -- TRGIX
TIAA-CREF International Equity Fund -- TRERX
TIAA-CREF International Equity Index Fund -- TRIEX
TIAA-CREF Large-Cap Growth Fund -- TILRX
TIAA-CREF Large-Cap Growth Index Fund -- TRIRX
TIAA-CREF Large-Cap Value Fund – TRLCX
TIAA-CREF Large-Cap Value Index Fund -- TRCVX
TIAA-CREF Mid-Cap Growth Fund -- TRGMX
TIAA-CREF Mid-Cap Value Fund -- TRVRX
TIAA-CREF Real Estate Securities Fund -- TRRSX
TIAA-CREF S&P 500 Index Fund -- TRSPX
TIAA-CREF Small-Cap Blend Index Fund -- TRBIX
TIAA-CREF Small-Cap Equity Fund – TRSEX
TIAA-CREF Social Choice Equity Fund -- TRSCX

FIXED INCOME

TIAA-CREF Bond Fund -- TIDRX
TIAA-CREF Bond Index Fund -- TBIRX
TIAA-CREF Bond Plus Fund -- TCBRX
TIAA-CREF High-Yield Fund -- TIHRX
TIAA-CREF Inflation-Linked Bond Fund -- TIKRX
TIAA-CREF Short-Term Bond Fund -- TISRX

MONEY MARKET

TIAA-CREF Money Market Fund -- TIEXX

MULTI-ASSET

TIAA-CREF Lifecycle 2010 Fund -- TCLEX
TIAA-CREF Lifecycle 2015 Fund -- TCLIX
TIAA-CREF Lifecycle 2020 Fund -- TCLTX
TIAA-CREF Lifecycle 2025 Fund -- TCLFX
TIAA-CREF Lifecycle 2030 Fund -- TCLNX
TIAA-CREF Lifecycle 2035 Fund -- TCLRX
TIAA-CREF Lifecycle 2040 Fund -- TCLOX
TIAA-CREF Lifecycle 2045 Fund -- TTFRX
TIAA-CREF Lifecycle 2050 Fund -- TLFRX
TIAA-CREF Lifecycle 2055 Fund -- TTRPX
TIAA-CREF Lifecycle Retirement Income Fund -- TLIRX

I will look into the WMA approach. As for going with 50-60% bonds, I worry that bonds will take a beating once "tapering" begins. Five years is not much time, but I do have the option of going for full SSA retirement in 7 years. Ouch, typing that hurts!
As per I'd go

33% equity index
17% international equity index (or 13% that and 4% Emerging Markets)
50% bond index fund (case for up to 20% in the inflation indexed bond fund). You might want to do something like 15% ST bond, 20% Bond index, 15% TIPS fund.

spencer99
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Re: Need Help With Allocation in Move to TIAA CREF

Post by spencer99 » Sat Sep 21, 2013 2:16 pm

Renaud,

I too have a 403(b) that offers several providers, including TIAA-CREF, and recently moved about half my fixed income from Fidelity to TC (I had not been a TC customer prior to this transfer).

I started this by calling TC. They routed me to a department that handles transfers. I was taken by the hand and things went perfectly. They did all the work, promptly and well.

S

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Dutch
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Re: Need Help With Allocation in Move to TIAA CREF

Post by Dutch » Sat Sep 21, 2013 2:34 pm

Yes, be aware of the withdrawal restrictions. But TIAA Traditional is one of the best deals in fixed income: no principal risk, 3% guaranteed rate, current rate above 3.75% (rates depended on type of account/contract). If you could buy an e-bond with those terms, everybody would be all over this.

Do your own homework and don't dismiss this option out of hand, especially in the current market (blasphemy I know :D )

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