TIAA and me again (and Vanguard)

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anglophile
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TIAA and me again (and Vanguard)

Post by anglophile » Sun Jan 21, 2018 1:14 pm

Late last year, I posted about investing in Vanguard through my TIAA 403(b). I'm in the process of reallocating my TIAA funds to Vanguard (while staying within TIAA). However, I've just discovered that the largest share of my TIAA account can only go into one Vanguard fund, VMFXX.
Currently, this money is in TIAA's Social Choice, which has an ER of .38%.

VMFXX doesn't seem to pay out much, though it does have a "low risk" rating on Vanguard's site. My other TIAA choices for this money appear to be annuities only.

Any advice on this one? Thanks so much.

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fortfun
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Re: TIAA and me again (and Vanguard)

Post by fortfun » Sun Jan 21, 2018 1:19 pm

anglophile wrote:
Sun Jan 21, 2018 1:14 pm
Late last year, I posted about investing in Vanguard through my TIAA 403(b). I'm in the process of reallocating my TIAA funds to Vanguard (while staying within TIAA). However, I've just discovered that the largest share of my TIAA account can only go into one Vanguard fund, VMFXX.
Currently, this money is in TIAA's Social Choice, which has an ER of .38%.

VMFXX doesn't seem to pay out much, though it does have a "low risk" rating on Vanguard's site. My other TIAA choices for this money appear to be annuities only.

Any advice on this one? Thanks so much.
Any other options besides TIAA? Fidelity?

ResearchMed
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Re: TIAA and me again (and Vanguard)

Post by ResearchMed » Sun Jan 21, 2018 1:26 pm

anglophile wrote:
Sun Jan 21, 2018 1:14 pm
Late last year, I posted about investing in Vanguard through my TIAA 403(b). I'm in the process of reallocating my TIAA funds to Vanguard (while staying within TIAA). However, I've just discovered that the largest share of my TIAA account can only go into one Vanguard fund, VMFXX.
Currently, this money is in TIAA's Social Choice, which has an ER of .38%.

VMFXX doesn't seem to pay out much, though it does have a "low risk" rating on Vanguard's site. My other TIAA choices for this money appear to be annuities only.

Any advice on this one? Thanks so much.
When you posted previously, there were several other options. But you had two different TIAA accounts/plans (2 different employers?)?

It seems odd that a TIAA account would use a Vanguard MM fund, or that it would be the only Vanguard choice included.

Could you perhaps post the same type of details for the plan involved?
It might also help to include (yes again) the details for the first plan. You might want to "mix and match" to optimize the use of the choices in each different employer plan.

RM
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aristotelian
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Re: TIAA and me again (and Vanguard)

Post by aristotelian » Sun Jan 21, 2018 1:53 pm

TIAA "annuities" are mostly just mutual funds that you can choose to annuitize. Please post a complete list of the options with their expense ratio.

What is your age and risk tolerance? We need more info to give you advice as every TIAA plan is different.

anglophile
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Re: TIAA and me again (and Vanguard)

Post by anglophile » Sun Jan 21, 2018 2:16 pm

OK, I'll try and set forth the details. You are correct in that I have worked for two institutions.

However, it is the funds I earned at my former employer that have limited investment possibilities.

1. The first one has 61% in equities, including small, mid, large and international growth equities, as well as small, mid and large cap value equities. The remainder is in bonds and foreign bonds, with 2% in "cash."

2. The second one mirrors the first one.

Other options for investing (besides the VMFXX) are:
a. CREF Equity Index Account (ER .34%)
b. CREF Global Equities (ER .44%)
c. CREF Growth account (ER .44%)
d. CREF Stock account (ER .43%)
e. CREF Bond Market (ER .40%)
f. CREF Inflation-Linked Bond (ER .35%)
g. CREF Money Market (ER .34%)
h. TIAA Real Estate Annuity (ER .85%--wow!)
i. TIAA Traditional (can't find any info on this right now).

And then there's the above-mentioned Vanguard MM.

I should note that funds from my current employer, I've been able to reallocate among Vanguard 500 Index Admiral, Vanguard Total Intl Stock Index Admiral and Vanguard Total Bond Market Index Admiral. It's just the money from the former employer that I can't seem to move to anything other than what I have listed above. I find this a bit confusing.

My age is 53. I would say my risk tolerance is medium. I don't have nearly enough saved (IMHO), with a net worth of $109K. I don't want to lose anything, but I feel that I was overly cautious in the past and could be doing better with my investmetns.

ResearchMed
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Re: TIAA and me again (and Vanguard)

Post by ResearchMed » Sun Jan 21, 2018 2:30 pm

anglophile wrote:
Sun Jan 21, 2018 2:16 pm
OK, I'll try and set forth the details. You are correct in that I have worked for two institutions.

However, it is the funds I earned at my former employer that have limited investment possibilities.

1. The first one has 61% in equities, including small, mid, large and international growth equities, as well as small, mid and large cap value equities. The remainder is in bonds and foreign bonds, with 2% in "cash."

2. The second one mirrors the first one.

Other options for investing (besides the VMFXX) are:
a. CREF Equity Index Account (ER .34%)
b. CREF Global Equities (ER .44%)
c. CREF Growth account (ER .44%)
d. CREF Stock account (ER .43%)
e. CREF Bond Market (ER .40%)
f. CREF Inflation-Linked Bond (ER .35%)
g. CREF Money Market (ER .34%)
h. TIAA Real Estate Annuity (ER .85%--wow!)
i. TIAA Traditional (can't find any info on this right now).

And then there's the above-mentioned Vanguard MM.

I should note that funds from my current employer, I've been able to reallocate among Vanguard 500 Index Admiral, Vanguard Total Intl Stock Index Admiral and Vanguard Total Bond Market Index Admiral. It's just the money from the former employer that I can't seem to move to anything other than what I have listed above. I find this a bit confusing.

My age is 53. I would say my risk tolerance is medium. I don't have nearly enough saved (IMHO), with a net worth of $109K. I don't want to lose anything, but I feel that I was overly cautious in the past and could be doing better with my investmetns.
This still isn't clear.

You wrote that "The second one mirrors the first one.

Other options for investing (besides the VMFXX) are:
"

Does that mean that the second has a similar variety as described for the first PLUS the listed funds?
Or....???

It would also help to know about how much is in each plan, and whether there are other investment holdings.
That is, if there is about a 50/50 split, that could be very different in terms of allocating vs. if you've got a 90/10 split.
If there is very little in one plan, that might best go into just one fund, and focus attention on the other plan.

If you don't feel comfortable with approximate amounts, then just indicate something like "$X in Plan 1" and "$15X in Plan 2" or such.

RM
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aristotelian
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Re: TIAA and me again (and Vanguard)

Post by aristotelian » Sun Jan 21, 2018 2:30 pm

anglophile wrote:
Sun Jan 21, 2018 2:16 pm

I should note that funds from my current employer, I've been able to reallocate among Vanguard 500 Index Admiral, Vanguard Total Intl Stock Index Admiral and Vanguard Total Bond Market Index Admiral. It's just the money from the former employer that I can't seem to move to anything other than what I have listed above. I find this a bit confusing.

My age is 53. I would say my risk tolerance is medium. I don't have nearly enough saved (IMHO), with a net worth of $109K. I don't want to lose anything, but I feel that I was overly cautious in the past and could be doing better with my investmetns.
I think TIAA Traditional Annuity might appeal to you. You need to do your research as there are different versions of it that trade higher yield for restrictions on liquidity. If you want to get out of it, you have to withdraw gradually over 10 years. However, in the meantime you earn essentially 4% with all expenses baked into the fund. When you retire, you have the option to annuitize, which you get you 5% (with survivor) or 6% (individual) guaranteed. Consider something like 50% Equity Index and 50% TIAA Traditional.

anglophile
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Re: TIAA and me again (and Vanguard)

Post by anglophile » Sun Jan 21, 2018 2:46 pm

No. 1 has $53K in it. No. 2 has $15K in it. What I meant by #2 being the same as #1 is that the investments are exactly the same. The $53K account is simply called a "Retirement Plan for Faculty, Admin, Prof Employees of the University of Blah Blah." The $15K account is a "Mandatory Tax Deferred Annuity Plan" for that same university.

The only Vanguard options for both No. 1 and No. 2 is VMFXX. The other options are the CREF ones I listed. In other words, options are identical for both accounts.

As far as other investment plans go:

I have split $17K between Vanguard 500 Index Admiral, Vanguard Total Intl Stock Index Admiral and Vanguard Total Bond Market Index Admiral.
In my independent Vanguard accounts, I have a Traditional IRA and a Roth.

The Traditional is in VFINX ($3,500) and VTHRX ($6K). The Roth is in VBINX ($3K).

I also have around $20K in banks to cover the cost of a new car, emergencies, possible down payment costs, misc.

I hope this helps! Sorry for being so unclear.

quaternion
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Re: TIAA and me again (and Vanguard)

Post by quaternion » Mon Jan 22, 2018 12:48 am

Going off your previous thread, why don't you transfer your 403(b) from your former employer (with poor fund choices) to the 403(b) with your current employer (with good fund choices)?

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mrc
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Re: TIAA and me again (and Vanguard)

Post by mrc » Mon Jan 22, 2018 5:27 am

quaternion wrote:
Mon Jan 22, 2018 12:48 am
Going off your previous thread, why don't you transfer your 403(b) from your former employer (with poor fund choices) to the 403(b) with your current employer (with good fund choices)?
That's a good idea, move it all (unless you want a piece of TREA). I worked for a large university, and can access Vanguard institutional class funds. Better ER than TSP in a few cases. But the higher tier ERs at TIAA (wife worked for a smaller entity and the same large univeristy) were much higher. I moved all in to TIAA (Vanguard Inst) when I retired. Wife moved her assets from high cost to low cost accounts within TIAA. If you cannot get into the lowest cost tier, move your funds.
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nisiprius
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Re: TIAA and me again (and Vanguard)

Post by nisiprius » Mon Jan 22, 2018 7:44 am

anglophile wrote:
Sun Jan 21, 2018 1:14 pm
Late last year, I posted about investing in Vanguard through my TIAA 403(b). I'm in the process of reallocating my TIAA funds to Vanguard (while staying within TIAA). However, I've just discovered that the largest share of my TIAA account can only go into one Vanguard fund, VMFXX.
Currently, this money is in TIAA's Social Choice, which has an ER of .38%.

VMFXX doesn't seem to pay out much, though it does have a "low risk" rating on Vanguard's site. My other TIAA choices for this money appear to be annuities only.

Any advice on this one? Thanks so much.
This makes no sense. You're misunderstanding something. You will either need to pick up the phone and call your representative at TIAA and make sure you understand the full scoop... or, if you feel TIAA is being seriously unhelpful, try calling Vanguard and asking them to deal with it.

The general rule of thumb is, "always deal with the brokerage that will be RECEIVING your funds" as they are the ones who are motivated to help you.

If you'd said it was TIAA Traditional then, hey, the rules are complicated... but Social Choice shouldn't be difficult.

Possibly the truth is that, while continuing to hold the assets at TIAA-CREF, you cannot do an "exchange" into any Vanguard fund but that one; that is, VMFXX is the "settlement account."

Ask what are the range of things you can AFTER it has been put into VMFXX. I'm not clear where you would be holding the VMFXX. If it is TIAA's brokerage, I'm almost certain that, as step #2, you can move that VMFXX holding to your Vanguard account, and from there, move it into any fund you like. In other words... a slow process that could take a couple of weeks overall, but doable.
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alrick
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Re: TIAA and me again (and Vanguard)

Post by alrick » Mon Jan 22, 2018 8:18 am

After many years of frustration dealing with TIAA/CREF I have moved nearly all of my TIAA funds elsewhere....primarily Vanguard.

The contacts they had with the various colleges and universities I worked for over the years were different and each had their own set of rules regarding choices and options for shifting. The major hurdle was the inability to take TIAA funds out in a single transaction as the investments were primarily in real estate....non-liquid. In one instance the transfer took 10 years of annual withdrawals of 10%....just had to set it up and (luckily) lived long enough to see $$$ fully transferred to Vanguard.

After trying to understand all these differences I finally decided that if I were to pass away my spouse and heirs would be tied in knots by these folks.

So my advice is to move as much as you can away from TIAA.......and move more as you can to leave as little (ideally none) with them as possible. You will be much happier with the results........and so will your heirs.

anglophile
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Re: TIAA and me again (and Vanguard)

Post by anglophile » Mon Jan 22, 2018 3:34 pm

Yes, I guess I had better give my TIAA guy a call, because this is all very confusing to me.

Thanks to everyone who weighed in on this!

Jon H
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Re: TIAA and me again (and Vanguard)

Post by Jon H » Mon Jan 22, 2018 7:10 pm

alrick wrote:
Mon Jan 22, 2018 8:18 am
After many years of frustration dealing with TIAA/CREF I have moved nearly all of my TIAA funds elsewhere....primarily Vanguard.

The contacts they had with the various colleges and universities I worked for over the years were different and each had their own set of rules regarding choices and options for shifting. The major hurdle was the inability to take TIAA funds out in a single transaction as the investments were primarily in real estate....non-liquid. In one instance the transfer took 10 years of annual withdrawals of 10%....just had to set it up and (luckily) lived long enough to see $$$ fully transferred to Vanguard.

After trying to understand all these differences I finally decided that if I were to pass away my spouse and heirs would be tied in knots by these folks.

So my advice is to move as much as you can away from TIAA.......and move more as you can to leave as little (ideally none) with them as possible. You will be much happier with the results........and so will your heirs.


TIAA products, while having somewhat low ER, still are about 5-8 fold higher than Vanguard. This difference would have cost me about $1700 per year on average over ten years on a mid to high 6 figure account. That number becomes about $100k over 30 years.

So, I did something similar, moving most of my account via asset transfer to Vanguard. This paperwork took about a week. I did keep the TIAA traditional position as a fixed asset.
Consider gain and loss, but never be greedy and everything will be alright (fortune cookie)

2015
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Re: TIAA and me again (and Vanguard)

Post by 2015 » Mon Jan 22, 2018 7:42 pm

alrick wrote:
Mon Jan 22, 2018 8:18 am
After many years of frustration dealing with TIAA/CREF I have moved nearly all of my TIAA funds elsewhere....primarily Vanguard.

The contacts they had with the various colleges and universities I worked for over the years were different and each had their own set of rules regarding choices and options for shifting. The major hurdle was the inability to take TIAA funds out in a single transaction as the investments were primarily in real estate....non-liquid. In one instance the transfer took 10 years of annual withdrawals of 10%....just had to set it up and (luckily) lived long enough to see $$$ fully transferred to Vanguard.

After trying to understand all these differences I finally decided that if I were to pass away my spouse and heirs would be tied in knots by these folks.

So my advice is to move as much as you can away from TIAA.......and move more as you can to leave as little (ideally none) with them as possible. You will be much happier with the results........and so will your heirs.
^^^
This!
TIAA is just awful in terms of website navigation, baffling inability to execute paperless statements requests, and overall convoluted procedures. I have a small transfer payout annuity that must be transferred out in equal installments, 4 of which have already taken place. Just last week they sent me a "secure message" with a confirmation of a regular payout transfer which they had executed in November of 2017! :oops:

I can't wait until that entire account is liquidated and I have nothing else to do with them.

anglophile
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Re: TIAA and me again (and Vanguard)

Post by anglophile » Wed Feb 28, 2018 2:28 pm

OP here. Just wanted to update this thread (rather than start another one).

I met with the TIAA rep this morning. It appears that the investments I made through my former employer cannot be reallocated to any Vanguard funds within TIAA. He explained that the former employer makes the decision on where the money will be invested.

I can, however, move it to some small, mid and large value and growth equities, as well as to a traditional annuity that will pay out until I kick the bucket, and earns 3% guaranteed.

Of course he tried to get me to reallocate a large chunk of the money (from my current job) that I had just put into Vanguard funds into a CREF fund. I'm not surprised there at all.

More stuff to think about and learn about!

bikechuck
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Re: TIAA and me again (and Vanguard)

Post by bikechuck » Wed Feb 28, 2018 10:18 pm

I have some money with TIAA from a former employer's 403 b plan. I left the funds with them and have them in traditional. One chunck is earning 4% and another 3.5%. The 4% chunk is subject to a ten year withdrawal period but the 3.5% chunk is not. I also own some TIAA Real Estate in an IRA.

I am happy to have this money invested with them and I prefer TIAA Traditional to a bond fund. My equities are with Vanguard and Schwab.and I need to supplement the TIAA with some other fixed income investments which I have with Vanguard and Schwab to reach my desired allocation.

I might annuitize my TIAA traditional when I reach the age of 70.5 and when I need to start taking RMDs. That is 6 years from now and will depend on a number of things such as how well my portfolio is holding up, the interest rate environment at the time etc.

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