How to rollover TIAA 403b?

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windyblow
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How to rollover TIAA 403b?

Post by windyblow »

Long time lurker, and first time poster. Registered to ask for your help. Thanks in advance!

I have a 403b with TIAA and hold a few Vanguard mutual funds though my account is called annuity contracts. I’d like to roll it over to an IRA. My objectives are:
• move the 403b assets in kind so not out of market during the rollover transition.
• in the target brokerage I can either continue to hold these Vanguard funds, or swap to hold index ETFs like VOO and SPY. Hope fees / commissions are minimal.
• not the big 3, i.e., Vanguard / Fidelity / Schwabs for other reasons. Fine to use TIAA, or eTrade or any brokerage arms from major banks like Chase / BMO, etc.
• the process of rollover should be as painless as possible and customer services are good. No other requirements since I'm largely a buy/hold guy.

Any recommendations for a brokerae to use? How should I initiate the rollover process? Ideally, I’d like to be able to contact a target brokerage and authorize it to contact TIAA with my minimal involvement to get the job done. Am I daydreaming? :wink:
slo-rock
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Re: How to rollover TIAA 403b?

Post by slo-rock »

I can’t speak to a game plan for the specific approach you describe, but I can tell you that I rolled over a 403b from TIAA to Vanguard IRA earlier this year and was pleasantly surprised by how easy and responsive TIAA was to work with. I spent maybe five minutes making changes on their website, printed/signed/scanned one document that I then uploaded with my phone, and received a check in a couple of days. Since you’re open to working with them and would prefer to keep your assets invested through the transition, I suspect they’re a good option to explore.
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CyclingDuo
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Re: How to rollover TIAA 403b?

Post by CyclingDuo »

windyblow wrote: Wed Dec 04, 2024 5:54 pm Long time lurker, and first time poster. Registered to ask for your help. Thanks in advance!

I have a 403b with TIAA and hold a few Vanguard mutual funds though my account is called annuity contracts. I’d like to roll it over to an IRA. My objectives are:
• move the 403b assets in kind so not out of market during the rollover transition.
Not possible to remain in the market during the rollover transition. Your funds at TIAA will be liquidated and then the cash amount transferred. You will repurchase the funds at the new brokerage.
windyblow wrote: Wed Dec 04, 2024 5:54 pm• in the target brokerage I can either continue to hold these Vanguard funds, or swap to hold index ETFs like VOO and SPY. Hope fees / commissions are minimal.
• not the big 3, i.e., Vanguard / Fidelity / Schwabs for other reasons. Fine to use TIAA, or eTrade or any brokerage arms from major banks like Chase / BMO, etc.
• the process of rollover should be as painless as possible and customer services are good. No other requirements since I'm largely a buy/hold guy.
Any recommendations for a brokerae to use? How should I initiate the rollover process? Ideally, I’d like to be able to contact a target brokerage and authorize it to contact TIAA with my minimal involvement to get the job done. Am I daydreaming? :wink:
You will replace the Vanguard funds you currently hold within your TIAA 403b, with the Vanguard funds at the brokerage firm you choose. My guess is your 403b funds are in the institutional shares of the Vanguard funds, and you will be purchasing the Admiral shares version or the ETFs at your targeted new brokerage firm. Most of us would highly suggest Fidelity or Vanguard as your choice. Both help make the process of moving your funds from TIAA over to their firm in a pretty seamless manner.

CyclingDuo
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dknightd
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Re: How to rollover TIAA 403b?

Post by dknightd »

What is wrong with TIAA?
Retired 2019. So far, so good. I want to wake up every morning. But I want to die in my sleep. Just another conundrum. I think the solution might be afternoon naps ;)
JohnDoh
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Re: How to rollover TIAA 403b?

Post by JohnDoh »

As stated, exiting the 403b will be done in cash. If you want to minimize time out of market, you can (I believe) do the rollover to a TIAA IRA in which you establish a "brokerage window" that will allow you to immediately buy ETFs, etc. The contents of the IRA brokerage window can then be transferred in-kind to wherever you like.

If you're interested in this approach, I'd confirm the details (possibility, timing, etc.) in advance.

Also, if you're going to be doing more than one rollover, you might just want to leave everything in the brokerage window until you're done and then transfer to your final destination.

Good luck.
student
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Re: How to rollover TIAA 403b?

Post by student »

Given that you said "not the big 3, i.e., Vanguard / Fidelity / Schwabs for other reasons. Fine to use TIAA, or eTrade or any brokerage arms from major banks like Chase / BMO, etc. " Is there a specific reason that you want am IRA rather than staying in 403b? More choices in investment? 403b may have its own advantage over IRA in terms of creditor protection.
4803
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Re: How to rollover TIAA 403b?

Post by 4803 »

This thread is interesting to me because I also have a 403b account at TIAA and will need to move it to an IRA at Fidelity next year or the year after. I am quite concerned about the process and a bit confused about some of what I read in this thread.

Ideally, I would like not to receive a check myself from TIAA but rather that the funds will move directly to Fidelity. I do understand that they will be liquidated out of the market during the transition period,

Question #1 - is it possible for the funds to move directly to Fidelity (without getting to me personally first)?

Question #2 - if anyone has experience with that, how long approximately would the transition take (and the funds be out of the market)?

If anyone with experience can explain the process, that would be appreciated.

Thank you and best wishes,

:) 4803.
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CyclingDuo
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Re: How to rollover TIAA 403b?

Post by CyclingDuo »

dknightd wrote: Thu Dec 05, 2024 9:15 am What is wrong with TIAA?
Good chance that the poster, if retired or moved on from previous employer, is having to pay an administrative wrap fee over and beyond the underlying ER fees of the individual funds. Employer usually covers that fee while working for them, but once one has left the organization the employee gets hit with paying those fees. Moving to a lower cost brokerage firm into an IRA would at least absolve the administrative wrap fee.

OP - do you know how much you are paying for the administrative wrap fee?

CyclingDuo
"Save like a pessimist, invest like an optimist." - Morgan Housel | "Pick a bushel, save a peck!" - Grandpa
Topic Author
windyblow
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Re: How to rollover TIAA 403b?

Post by windyblow »

CyclingDuo wrote: Thu Dec 05, 2024 9:57 am
dknightd wrote: Thu Dec 05, 2024 9:15 am What is wrong with TIAA?
Good chance that the poster, if retired or moved on from previous employer, is having to pay an administrative wrap fee over and beyond the underlying ER fees of the individual funds. Employer usually covers that fee while working for them, but once one has left the organization the employee gets hit with paying those fees. Moving to a lower cost brokerage firm into an IRA would at least absolve the administrative wrap fee.

OP - do you know how much you are paying for the administrative wrap fee?

CyclingDuo
I want to leave 403B primarily it's quite confusing to me. TIAA's website doesn't help either. I just want to deal with a simple site to trade some mutual funds or ETFs.

I don't know the administrative wrap fee at TIAA. Not sure what this question is about :( But not the main reason for me to want to leave TIAA as aforementioned.

I thought I could do a direct rollover; i.e. let TIAA directly rollover the entire fund to a new brokerage. Is this option not available for TIAA 403B? (try not to deal with snail mails, paper checks to minimize errors)
Tramper Al
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Re: How to rollover TIAA 403b?

Post by Tramper Al »

windyblow wrote: Thu Dec 05, 2024 12:41 pm I want to leave 403B primarily it's quite confusing to me. TIAA's website doesn't help either. I just want to deal with a simple site to trade some mutual funds or ETFs.

I don't know the administrative wrap fee at TIAA. Not sure what this question is about :( But not the main reason for me to want to leave TIAA as aforementioned.

I thought I could do a direct rollover; i.e. let TIAA directly rollover the entire fund to a new brokerage. Is this option not available for TIAA 403B? (try not to deal with snail mails, paper checks to minimize errors)
I have TIAA 403b and 401a, offered through former employee, and I can understand the "confusing" contention here - particularly if one is accustomed to a more straightforward account structure and website. I'm sure it can be a little different setup for different employers, but mine both have this: 1) a retirement side, which is where the 2 dozen or so no-transaction-fee funds live - including the various target date funds. Most of these are TIAA/CREF/Nuveen, but the very best/cheapest half dozen or so are Vanguard, and one Schwab. 2) the other side, which they call "brokerage", is where all of my orphaned positions reside, all bought in years past while Vanguard was the vendor, now all requiring a transaction fee. I don't really know what is available there (no list is apparent), so I just have to try to place an order where I might discover "that fund can't be bought here" or what transaction fee $ will be applied. Strangely TIAA's own Real Estate is in that category, and (additional) shares cannot be purchased. Moving between one side and the other, even a simple Vanguard to Vanguard fund exchange, requires operating on a couple of different platforms, and the time between old fund sale and new fund purchase might end up being 0, 1, or 2 days - extra time to bridge platforms I suppose. This feature also dates back to the Vanguard times. The "transactions" listings don't included events like fund exchanges or distributions/reinvestment (?), and I'll really left to just catch up based on the positions page. So yes, it can be confusing and rather unfriendly.

As for direct rollover, it depends on just what you mean. I don't think it is possible for individual portfolio positions to survive intact the move from a 403b to a rollover IRA, from what I understand that is always as cash, wire or check. And some firms this even still involves faxes and U.S. Mail. The test would be I guess from TIAA to TIAA. My TIAA IRA is of the type I was advised to open to hold TIAA Real Estate, and you won't find that any better than the 403b - really limited mutual fund type choices only, and same clunky web site. My impression is that the receiving firm provides most of the initiative for the rollover steps to happen. That has certainly been the case for me transferring IRA to IRA when TIAA in involved.

I read this thread with interest, always hoping for a better TIAA experience.
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ResearchMed
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Re: How to rollover TIAA 403b?

Post by ResearchMed »

windyblow wrote: Thu Dec 05, 2024 12:41 pm I thought I could do a direct rollover; i.e. let TIAA directly rollover the entire fund to a new brokerage. Is this option not available for TIAA 403B? (try not to deal with snail mails, paper checks to minimize errors)

Our understanding is that if a 403b (okay, if *our* 403b plan!) is moved out of the TIAA 403b to an IRA, it *must* be liquidated first.
Yes, that was annoying when we found out about that for the first time.
Moving holdings from an IRA to another IRA was so much more simple: they almost always went "in kind", unless there was some sort of odd-ball holding that the receiving IRA couldn't/wouldn't/doesn't handle.

In fact, our 403b plan has 2 sections, kept completely separate and with different choices.
"A" is for money contributed by the EmployER and "B" is for money contributed by the EmployEE.
A has restrictions while employed; B does not. B also has *many* more investment choices.

IF we want to move money from A to B, the relevant holdings much be liquidated. And this is remaining at TIAA and even remaining in the same 403b plan!
However, in this case, no check is sent. The "cash amount" is moved from one money market fund in A to a MM fund in B.

And we've had money moved to TIRA or Roth IRA from the 403b, also all at TIAA. The money moved internally. No check was sent. One day it was in A or B, and the next day it showed up in the specified IRA.
But from a 403b, nothing moved "in kind".

RM
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Re: How to rollover TIAA 403b?

Post by crefwatch »

windyblow wrote: Wed Dec 04, 2024 5:54 pm I have a 403b with TIAA and hold a few Vanguard mutual funds though my account is called annuity contracts. I’d like to roll it over to an IRA. My objectives are:
• move the 403b assets in kind so not out of market during the rollover transition.
• in the target brokerage I can either continue to hold these Vanguard funds, or swap to hold index ETFs like VOO and SPY. Hope fees / commissions are minimal.
• not the big 3, i.e., Vanguard / Fidelity / Schwabs for other reasons. Fine to use TIAA, or eTrade or any brokerage arms from major banks like Chase / BMO, etc.
• the process of rollover should be as painless as possible and customer services are good. No other requirements since I'm largely a buy/hold guy.
How long since you terminated service at that 403(b) employer? What is your age? Will they allow you to move the money yet? (Some paternalistic employers make it hard to get out, nothing to do with TIAA.)

TIAA IRA accounts probably can't hold low-cost Vanguard funds right in the basic IRA account. And you have presented perfectly good reasons to leave TIAA, which is not the most customer-friendly place. (I did consolidate my IRAs at TIAA.) It would help to know why you are avoiding the big discount brokers. I have no experience with the universe you are considering, but you may be cutting off your nose to spite your face. There is no brokerage that has ZERO complaints.

Try to de-stress about remaining invested. In 50 years of retirement investing, there are 18,250 days. It is not true that Blackrock, Warren Buffet, and Bill Gates are making a fool of you because you were out of the market for 5 days - during which the market could have gone down.

That said, it's not that hard to roll over to another brokerage. Start with TIAA. See if you need a Proof Of Separation from Service. I doubt you can directly hold Vanguard Open-End mutual funds at Fidelity, but you have ruled out Fidelity. But you said you're happy with ETFs. I think you might get marketing phone calls if you open a brokerage at a bank like Chase or B of A.

We can't guarantee that the process will go smoothly, because there is so much variation in the quality of phone bank employees, and in the random occurrence of errors. But people do this every day. Of course it would be especially easy at TIAA, but you do not sound like you would be happy with your remaining years at TIAA. (I simply mean that TIAA gets a lot of complaints, and has many confusing policies, not insulting you personally.)

In my state, NJ, 403(b) distributions are state-taxed differently than IRA distributions. In some states, 403(b)'s may have different lawsuit and marital dissolution protections than do IRAs. IANAL.
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Rocinante Rider
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Re: How to rollover TIAA 403b?

Post by Rocinante Rider »

I'm in the process of rolling over a Fidelity 403b with substantial assets to my Vanguard traditional IRA. Holdings in a 403b cannot be rolled over in-kind, and they cannot be transferred directly from custodian to custodian. Nevertheless, one can still do "direct rollovers" and minimize time out of market by doing a series of partial rollovers (partial rollovers can only be done one fund holding at time). Here's how I'm doing it:

1. Exchange 100% of any short-term fixed income fund into the money market fund in my 403b (if you have MMkt funds in any other tax-advantages accounts, you can also use them to purchase stock or bond funds while simultaneously selling similar funds in the 403b, thus maintaining your AA).
2. The next day, I call Fidelity and ask for a "direct partial rollover" of the full balance in the money market fund. I have Fidelity make out the check to "Vanguard FBO [my name]," and mail it express mail to me ($25 fee Fidelity charges for express mail is more than offset by getting the money invested ASAP in my VG IRA settlement fund.
3. Fidelity sends the check to me the day after my phone call and I receive it the day after it's mailed.
4. As soon as the check arrives, I use the Vanguard app to deposit it as a direct rollover into my VG traditional IRA. The amount shows up immediately in my VG IRA settlement fund where it can be used to buy VG mutual funds immediately or to buy VG etfs after a 7 day hold.
5. As soon as the money in my VG IRA settlement fund is available to trade, I use it toward the close of a trading day to buy a comparable amount of a VG etf to a similar fund that I sell that day in my Fidelity 403b, with the sale proceeds at Fidelity going back into a Fidelity money market fund.
6. Rinse and repeat steps 2-5

The end result is that the only money that's out-of-the-market during this process is the initial exchange of short-term fixed income funds into money market. For example, sales of stock funds at Fidelity are immediately offset by purchases within the VG traditional IRA. I assume you could use a similar process with a TIAA 403b being transferred in installments to an IRA at a brokerage other than VG.
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Re: How to rollover TIAA 403b?

Post by SpaghettiLegs »

Just today, we completed a transfer of my wife’s old employer TIAA 403b to Schwab. It was a bit more labor intensive, as typically with Schwab, I just have to tell Schwab an institution and account number and they do all the work once I’ve created a receiving account. In this case, I created the rollover IRA at Schwab and then initiated the transfer via TIAA. Main reason was I couldn’t find an account number anywhere for the TIAA. One added step was I had to submit a notarized form releasing my spousal survivorship claim to the account. Once it was signed and notarized I just uploaded it through the TIAA site. Once this was done the funds showed up in the rollover IRA as cash about 5 days later. Schwab reported it to us as “we received the check”.
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windyblow
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Re: How to rollover TIAA 403b?

Post by windyblow »

JohnDoh wrote: Thu Dec 05, 2024 9:16 am As stated, exiting the 403b will be done in cash. If you want to minimize time out of market, you can (I believe) do the rollover to a TIAA IRA in which you establish a "brokerage window" that will allow you to immediately buy ETFs, etc. The contents of the IRA brokerage window can then be transferred in-kind to wherever you like.

If you're interested in this approach, I'd confirm the details (possibility, timing, etc.) in advance.

Also, if you're going to be doing more than one rollover, you might just want to leave everything in the brokerage window until you're done and then transfer to your final destination.

Good luck.
Open a TIAA IRA in the TIAA brokerage. Then rollover my 403B to this 'brokerage window'. Given both accounts are with TIAA, TIAA would allow me to buy ETF immediately. Is this what you're saying? I suppose no checks need to be sent to me but the funds go directly from TIAA 403b to TIAA IRA?

If so, this would be a good solution to me. I get it that 403b has to be transferred by cash. I'm fine with it if not liking it. I don't want a paper check via my hands worrying about lost checks, and then possibly tax impact (heard any delay will make IRS think I cash out the account?) And if TIAA brokerage is reasonable, i.e., not charging excessive fees, I may be a long term client of them :D
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Re: How to rollover TIAA 403b?

Post by DukeBlue »

4803 wrote: Thu Dec 05, 2024 9:37 am This thread is interesting to me because I also have a 403b account at TIAA and will need to move it to an IRA at Fidelity next year or the year after. I am quite concerned about the process and a bit confused about some of what I read in this thread.

Ideally, I would like not to receive a check myself from TIAA but rather that the funds will move directly to Fidelity. I do understand that they will be liquidated out of the market during the transition period,

Question #1 - is it possible for the funds to move directly to Fidelity (without getting to me personally first)?

Question #2 - if anyone has experience with that, how long approximately would the transition take (and the funds be out of the market)?

If anyone with experience can explain the process, that would be appreciated.
I did this a year ago. I started the process at Fidelity but then had to contact TIAA for some paperwork. The funds were out of the market for 3-5 days, but the entire process took a week or so. The transfer occurred directly between TIAA and Fidelity.
4803
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Re: How to rollover TIAA 403b?

Post by 4803 »

Very useful - thank you DukeBlue, SpaghettiLegs, and others that replied.

Best wishes,

:) 4803.
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Re: How to rollover TIAA 403b?

Post by crefwatch »

If you decide to use TIAA, make sure you ask for a Brokerage window when you open the IRA. It is a separate step from "opening an IRA." (No cost, however.)

It is remotely possible that the Vanguard accounts will be moved in kind to the Brokerage platform, but that would mean $35 fees to buy more or sell them.

Be sure you understand the differences between the interest rate tables in these three documents:

https://www.tiaa.org/public/investment- ... r=47933634

https://www.tiaa.org/public/investment- ... r=47933630

https://www.tiaa.org/public/investment- ... r=47933632

And also the table (identical in all three) for "Income Payout Rates".
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Re: How to rollover TIAA 403b?

Post by NewMexicoLinnet »

It is remotely possible that the Vanguard accounts will be moved in kind to the Brokerage platform, but that would mean $35 fees to buy more or sell them.
Since the OP mentioned he was open to using ETFs, it is worth clarifying that while there are $35 fees to buy Vanguard mutual funds in a TIAA brokerage account, it costs nothing to buy Vanguard ETFs (and there are no other fees specifically associated with these accounts).

We can perhaps discuss the shortcomings of TIAA's online platform but, from a cost perspective, a TIAA IRA with a brokerage window containing Vanguard ETFs is a cost effective solution. For DW and me, it keeps our IRAs under the same roof as our employer (401k, 403b and 457b) plans.
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Re: How to rollover TIAA 403b?

Post by crefwatch »

Thank you NewMexicoLinnet. I was referring to the OP's first sentence of his question,

"I have a 403b with TIAA and hold a few Vanguard mutual funds though my account is called annuity contracts. "

That suggests to me that he has a 403(b) investment that is NOT in the investment menu for a TIAA IRA. (I have both an IRA and a Roth IRA at TIAA.) While I have performed MF->ETF conversions within my taxable Brokerage at Vanguard, I don't think they would be as easy at TIAA. So I though I should warn the OP that he might be subject to a, possibly new and confusing, situation if the conversion happens to move the open-end mutual funds in-kind.

I don't actually know what will happen. But I can tell you that a 4.50% load A-share mutual fund that TIAA does not offer was moved in-kind when I rolled an old Paine Webber IRA into my TIAA IRA Brokerage, for consolidation purposes.
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windyblow
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Re: How to rollover TIAA 403b?

Post by windyblow »

Thank you all for helpful discussions! Haven't read all materials yet but will do. Thanks! Some asked questions about me: mid-50s, recently retired. This 403B was there from a job in my youth and the former employer has no problems if I want to transfer it out to an IRA.

I wanted to get out of TIAA almost completely to try to make my life easier: to understand what I hold, what I can do, and what my options are. When it comes down to TIAA 403b, it's just so many mysterious terms there for me. Another adventure I'd like to explore in 2025 is to learn to convert this 403b to Roth IRA.

But it seems moving out of TIAA not trivial either. So now I am thinking maybe I should stick around with TIAA another few years until I reach 60? Then I could start drawing down my 403B without penalty? Is that a better way ('better' for me is a relatively straightforward process despite potentially higher fees or not 'optimal' from an investment perspective)
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ResearchMed
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Re: How to rollover TIAA 403b?

Post by ResearchMed »

windyblow wrote: Fri Dec 06, 2024 11:16 am Thank you all for helpful discussions! Haven't read all materials yet but will do. Thanks! Some asked questions about me: mid-50s, recently retired. This 403B was there from a job in my youth and the former employer has no problems if I want to transfer it out to an IRA.

I wanted to get out of TIAA almost completely to try to make my life easier: to understand what I hold, what I can do, and what my options are. When it comes down to TIAA 403b, it's just so many mysterious terms there for me. Another adventure I'd like to explore in 2025 is to learn to convert this 403b to Roth IRA.

But it seems moving out of TIAA not trivial either. So now I am thinking maybe I should stick around with TIAA another few years until I reach 60? Then I could start drawing down my 403B without penalty? Is that a better way ('better' for me is a relatively straightforward process despite potentially higher fees or not 'optimal' from an investment perspective)

I'm not sure that you'll find if you "start drawing down" your 403b at TIAA that it's "better".
Are you married?
If so, there is that spousal waiver that needs to be notarized *each* time you remove money from the 403b. That can be done online, so it's less onerous than it might seem, but still... if drawing down means repeated distributions, that might not be "better". OTOH, if you move the money to a TIRA, for example, there would be the one spousal waiver and that's done.
(I don't know if a recurring distribution can be arranged on the spousal waiver form.)

IF you decide to move the money to a TIRA (or Roth IRA), you could do that with an IRA at TIAA or at some other vender. If it's at TIAA, the money moves very quickly.
Is this, from a job in your youth, enough money to spend much time on, vs., moving it just once?

RM
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windyblow
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Re: How to rollover TIAA 403b?

Post by windyblow »

ResearchMed wrote: Fri Dec 06, 2024 11:35 am
windyblow wrote: Fri Dec 06, 2024 11:16 am Thank you all for helpful discussions! Haven't read all materials yet but will do. Thanks! Some asked questions about me: mid-50s, recently retired. This 403B was there from a job in my youth and the former employer has no problems if I want to transfer it out to an IRA.

I wanted to get out of TIAA almost completely to try to make my life easier: to understand what I hold, what I can do, and what my options are. When it comes down to TIAA 403b, it's just so many mysterious terms there for me. Another adventure I'd like to explore in 2025 is to learn to convert this 403b to Roth IRA.

But it seems moving out of TIAA not trivial either. So now I am thinking maybe I should stick around with TIAA another few years until I reach 60? Then I could start drawing down my 403B without penalty? Is that a better way ('better' for me is a relatively straightforward process despite potentially higher fees or not 'optimal' from an investment perspective)

I'm not sure that you'll find if you "start drawing down" your 403b at TIAA that it's "better".
Are you married?
If so, there is that spousal waiver that needs to be notarized *each* time you remove money from the 403b. That can be done online, so it's less onerous than it might seem, but still... if drawing down means repeated distributions, that might not be "better". OTOH, if you move the money to a TIRA, for example, there would be the one spousal waiver and that's done.
(I don't know if a recurring distribution can be arranged on the spousal waiver form.)

IF you decide to move the money to a TIRA (or Roth IRA), you could do that with an IRA at TIAA or at some other vender. If it's at TIAA, the money moves very quickly.
Is this, from a job in your youth, enough money to spend much time on, vs., moving it just once?

RM
RM, thanks for engaging the discussion. When I used words like 'better', 'optimal', I meant to have a very simple process. A bit background info that my aged eyes got some issues and one reason for me to have retired. I couldn't want to spend too much time to navigate websites. So whichever way is simpler, require less time to read online, is better for me and I'm willing to pay a bit more in terms of fees, etc.

My current balance is mid-six digits now. Modest contributions in earlier years compounded to an amount significant to me. I wished I contributed more back then. Now retired so I do have much time to deal with it though my vision as mentioned could easily get tired thus the desire to get this done with minimal paperwork from my end.

That is why in my OP I would find a brokerage to take my case and move the money for me. I thought there is an easy answer but apparently not. I'll keep researching on it if slowly. Thanks again for all of you.
rustwood
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Re: How to rollover TIAA 403b?

Post by rustwood »

With the possible exception that you might have some holdings in a restricted version of TIAA traditional (TBD), I don't see why you seem to think that moving money out of a TIAA 403b is any more difficult than moving it out of any other 403b (or maybe even any other 401k).
livesoft
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Re: How to rollover TIAA 403b?

Post by livesoft »

4803 wrote: Thu Dec 05, 2024 9:37 am Question #1 - is it possible for the funds to move directly to Fidelity (without getting to me personally first)?
NO.

Question #2 - if anyone has experience with that, how long approximately would the transition take (and the funds be out of the market)?
Little as one week or more than a month.

If anyone with experience can explain the process, that would be appreciated.
I posted about my spouse's experience:
viewtopic.php?p=4122413
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windyblow
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Re: How to rollover TIAA 403b?

Post by windyblow »

rustwood wrote: Fri Dec 06, 2024 12:50 pm With the possible exception that you might have some holdings in a restricted version of TIAA traditional (TBD), I don't see why you seem to think that moving money out of a TIAA 403b is any more difficult than moving it out of any other 403b (or maybe even any other 401k).
I guess it's mostly reflecting my lack of knowledge about 403b with speak of annuity contracts, etc. I'm much more conversational with a typical 401K with mutual funds only.

Since I couldn't move the funds in kind, I suppose the first step is to move everything into cash. The only cash-equivalent is a Vanguard MMF unlike my 401K accounts in which there is always a 'stable value' fund? I guess it doesn't matter?
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ResearchMed
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Re: How to rollover TIAA 403b?

Post by ResearchMed »

windyblow wrote: Fri Dec 06, 2024 1:24 pm
rustwood wrote: Fri Dec 06, 2024 12:50 pm With the possible exception that you might have some holdings in a restricted version of TIAA traditional (TBD), I don't see why you seem to think that moving money out of a TIAA 403b is any more difficult than moving it out of any other 403b (or maybe even any other 401k).
I guess it's mostly reflecting my lack of knowledge about 403b with speak of annuity contracts, etc. I'm much more conversational with a typical 401K with mutual funds only.

Since I couldn't move the funds in kind, I suppose the first step is to move everything into cash. The only cash-equivalent is a Vanguard MMF unlike my 401K accounts in which there is always a 'stable value' fund? I guess it doesn't matter?

The word "annuity" has way too many meanings! :wink:
In this case, at TIAA, their "variable annuities" such as "equity index" or such (the ones that look very much like a regular mutual fund) ARE very much like a mutual fund.
They have a slightly higher expense ratio, because they can be annuitized (meaning, changed into something like an SPIA (life annuity).
Even though there is no way to move them out of TIAA, there are likely very similar "just mutual fund", at TIAA or elsewhere, such as "equity index" or "total stock market", etc., depending upon the specific "variable annuity" at TIAA.

Also, in some cases, at least in the past (this may or may not still be true), one could buy a TIAA variable annuity at TIAA, such as equity index, after selling something like "total stock market"... and then annuitize.
I don't know if there are any "extra" payments once annuitized that are based upon the length of time held, such as with Traditional Annuity.

Yes, it's complicated, especially when one is first trying to learn about the various offerings at TIAA.

RM
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Rocinante Rider
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Re: How to rollover TIAA 403b?

Post by Rocinante Rider »

livesoft wrote: Fri Dec 06, 2024 12:51 pm
4803 wrote: Thu Dec 05, 2024 9:37 am Question #1 - is it possible for the funds to move directly to Fidelity (without getting to me personally first)?
NO.

Question #2 - if anyone has experience with that, how long approximately would the transition take (and the funds be out of the market)?
Little as one week or more than a month.

If anyone with experience can explain the process, that would be appreciated.
I posted about my spouse's experience:
viewtopic.php?p=4122413
If one does a series of two or more partial rollovers as I'm doing, it's possible to do the transition and be out of the stock market for barely a minute.
ReadyOrNot
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Re: How to rollover TIAA 403b?

Post by ReadyOrNot »

TIAA isn't so bad. Their fees are higher than Vanguard or Fidelity, but usually not terrible. Seems like you may not have a large amount at TIAA anyway.

Sounds like your Institution contracted with TIAA to administrate the retirement plan and include some Vanguard funds in the plan, probably with very low fees or costs. If so, you should be able to choose them just as in any other retirement plan.
Most of the CREF options work like funds in other plans. Maybe the only big difference is the option to convert them to a fair annuity in the future.

The traditional TIAA annuity is the only confusing option. Some are not liquid, and you can only take money out as an annuity, a payout annuity (10 payments iver 9 years) or as a proportional part of your (required) RMD. You might want to start a payout annuity as early as you can to get money out. It doesn't have to leave the 403b or get taxed -- it can go into another fund choice.

I simply opened a rollover IRA at TIAA. It appears as another section in my TIAA account. There are sections for the 401a
retirement plan, a discontinued retirement plan, a 403b plan, and the rollover IRA.
I figure the rollover IRA isn't so great, but will allow QCD donations which can consume the funds instead of generating unwanted income from RMDs.
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CyclingDuo
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Re: How to rollover TIAA 403b?

Post by CyclingDuo »

windyblow wrote: Thu Dec 05, 2024 12:41 pm
CyclingDuo wrote: Thu Dec 05, 2024 9:57 am

Good chance that the poster, if retired or moved on from previous employer, is having to pay an administrative wrap fee over and beyond the underlying ER fees of the individual funds. Employer usually covers that fee while working for them, but once one has left the organization the employee gets hit with paying those fees. Moving to a lower cost brokerage firm into an IRA would at least absolve the administrative wrap fee.

OP - do you know how much you are paying for the administrative wrap fee?

CyclingDuo
I want to leave 403B primarily it's quite confusing to me. TIAA's website doesn't help either. I just want to deal with a simple site to trade some mutual funds or ETFs.

I don't know the administrative wrap fee at TIAA. Not sure what this question is about :( But not the main reason for me to want to leave TIAA as aforementioned.
Yes, I agree there are a lot of terms.

I apologize for throwing the administrative wrap fee term at you, but it is a typical fee within 403b and 457b plans where the service provider for your workplace retirement fund adds some additional fees over and beyond the underlying expense ratio fees (ER fees) charged by every mutual fund simply to manage and service your account. Call them Admin Fees, Administrative Wrap Fees, Service Fees, or what have you - they exist.

Your quarterly and annual statements should list the amount you are being charged. Each fund has an expense ratio, and the admin fee that was previously paid for by your employer is now being paid by you. Those fees should show up in the quarterly/annual statements as TIAA Service Charges/Fees or TIAA Plan Servicing Fees. You will see dividends listed on each statement, as well as the servicing fees for each quarter on your statement. Those servicing fees may be a tenth of one percent or more (or less) depending on your former employer's arrangement with TIAA and what their particular plan is charged in fees.

Perhaps not a huge deal, but I was just asking because if you got those funds into a low cost brokerage firm traditional IRA account (tIRA), then you would at least be saving that portion of your quarterly/annual service fee charges and only be paying the expense ratios of the underlying Vanguard funds/ETFs in their new location.

When you add the underlying service fee charges (admin fees) + the expense ratio fees of each underlying mutual fund (ER fee) it can equal an amount that may or may not take you out of the bottom row of this graphic...

Image

In other words, you don't want to share too much of the pie with TIAA. You want to keep it a very small sliver of a slice such as the graphic in the lower right corner that shows the Expense Ratio of 0.04%. Moving to a low cost brokerage firm such as Fidelity, Vanguard, Schwab would allow you to be paying the expense ratio (ER fee) only of your mutual funds or ETFs and not having to pay any sort of a servicing fee/admin fee/administrative wrap fee on top of the ER fees to hold your money there.

Transferring your money to a low cost brokerage firm would mean you would repurchase your asset allocation (AA) as in bond funds/equity funds in the IRA at the low cost brokerage firm to match your needs. Whether it be the low cost ETF versions of your favorite mutual funds, or mutual funds themselves - it can all be done at lower cost than what you are currently paying at TIAA due to your servicing fees that you are being charged to hold your money there in a plan from your former employer as an ex-employee of that company.

That, in a nutshell, is what I was trying to say with the terminology used in my previous post.

CyclingDuo
"Save like a pessimist, invest like an optimist." - Morgan Housel | "Pick a bushel, save a peck!" - Grandpa
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windyblow
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Re: How to rollover TIAA 403b?

Post by windyblow »

CyclingDuo, thanks much for detailed explanations. Very helpful. Absolutely agree with all the points. That is why I started this thread to figure out how to literally do it to get to use a low cost brokerage.

All the replies and comments are useful and I’ll take time to read them. I’m afraid it’s too much to ask. As the post title indicates, what I really look for is a specific, detailed, step-by-step guidance to literally move the funds from TIAA to a low cost brokerage account as a rollover IRA. I know it’s my own homework and will work on it. But thanks again for all pointers. And certainly get me a head start now
IgnorantProf
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Re: How to rollover TIAA 403b?

Post by IgnorantProf »

I also have a TIAA account and if your employer gives you access to institutional and institutional plus shared, the "wrapper" or servicing fees may not be too much of an issue.

For example, if I buy VFIAX through an IRA with vanguard (assuming I have less than $10M), then it would have an expense ratio of 0.04% (https://investor.vanguard.com/investmen ... file/vfiax).

In contrast, if I buy VIIIX (the institutional plus shares version of VFIAX that requires $>100M invested) through my TIAA employer retirement account, then I only have to an expense ratio of 0.02% (https://investor.vanguard.com/investmen ... file/viiix). In reviewing my quarterly TIAA statements, it looks like I am paying 0.02% in servicing fees (I think this fee varies by employer, so your milage may vary). Thus, my total expense ratio through TIAA is 0.04%, which is the same I would have paid through vanguard directly.
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