Author Topic: TIAA Creff??  (Read 11065 times)

emabrook

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TIAA Creff??
« on: July 31, 2013, 11:35:59 AM »
Hi all,
need help...

Just finished paying off debt with Dave Ramsey's program on June 30th...  paid $86k of debt in 2 years. Our two cars are paid for.
Have 3 kids. Currently renting , best public school system around.


Very new to investing.
I see Vanguard gets recommended, we were advised to open a TIAA Creff mutual funds account, can't figure out the management fees are or whether is even a good idea...
Any advice?
« Last Edit: August 11, 2013, 09:17:12 PM by emabrook »

matchewed

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Re: TIAA Creff??
« Reply #1 on: July 31, 2013, 11:53:57 AM »
Well if you choose to open a TIAA Creff mutual fund account the fees will be based on which fund you choose. The mutual fund account itself does not have the fee.

https://personal.vanguard.com/us/funds/snapshot?FundId=0307&FundIntExt=INT#tab=3
https://www.tiaa-cref.org/public/tcfpi/Investment/Profile?investment=ILCVCLB

Those two links are between Vanguard and TIAA Creff for comparable funds. You can see the fee differences. Depending on the amount and timeline that .6% difference can be tens of thousands of dollars.

Your money but if I were in your shoes I would go with the company that lets you keep more of it.

grantmeaname

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Re: TIAA Creff??
« Reply #2 on: July 31, 2013, 01:05:07 PM »
88 basis points a year for an index? Run, don't walk, away!

emabrook

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Re: TIAA Creff??
« Reply #3 on: July 31, 2013, 01:27:52 PM »
Thank you,
Just went to Vanguard's site and set up an account. Reading the fine print for the  Vanguard 500 Index Fund ($3,000).
Feel so grown up!!!

aj_yooper

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Re: TIAA Creff??
« Reply #4 on: August 02, 2013, 07:54:43 PM »
Congratulations on your heroic success on your debt!  Every day amazing people, like you, share their success.  Thank you.

Way to get all grown up with a new Vanguard account.  That is where we keep our stash too.

Regarding your OP situation:  Are there other options for your husband's 403b?  Some districts have a variety of options and some allow you to suggest or bring in other choices, like Vanguard, to the teacher 403b choice list.  That is what we did.

Also, it is easy to transfer your money to Vanguard, as in your IRA, or, if your husband is able to switch to V.  Call the Vanguard concierge service (800-750-1520) while you are online and they will walk you through the process quickly.  You will see the forms on your screen shortly after they create them; they are excellent.  Don't ask TIAA to move it to Vanguard.  Some companies create obstacles to individuals that they do not do with a Vanguard.  Go to Bogleheads (http://www.bogleheads.org/wiki/Bogleheads_investing_start-up_kit) to find out what types of asset allocation to do for your portfolio.  Andrew Tobias' The Only Investment Guide You'll Ever Need and The Bogleheads' Guide to Investing are excellent.

Best wishes.

emabrook

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Re: TIAA Creff??
« Reply #5 on: August 10, 2013, 09:26:44 PM »
Thank you for your reply. I did set up the IRA with Vanguard for myself, contacted TIAA and they told me it will take  a few weeks. But the process has started already...
Hubby will be meeting with his TIAA rep this coming week to see more about his portfolio-he has been contributing for over 10 years.
Just watched the PBS Frontline Retirement documentary and now I am really scared of all the time that was lost when we didn't bother to educate ourselves about investing and lost time and money if fees. In our defense, this is the first time in life we are completely debt free and have some "spare" money to invest.

« Last Edit: August 11, 2013, 09:15:49 PM by emabrook »

emabrook

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Re: TIAA Creff??
« Reply #6 on: August 11, 2013, 09:30:26 PM »

Thank you kindly.
Spent the weekend reading the investing kit on bogleheads and followed many links.
Placed two books on reserve at my local library. Read the free excerpt from the "Boggleheads Guide to investing"...and got my husband intrigued now.

Also calculated our net worth for the first time.
That calculator made me sad. I feel really bad about not owning a house (renting right now).      Although I know it's an emotional reaction, can't help it. Even used Salman Khan's "Rent vs buying a house" model and saw the numbers...but it's still bugging me.
In awe that there are so many people on this site and bogleheads, just wanting to help with advice, no strings attached...feel very humbled...

pbkmaine

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Re: TIAA Creff??
« Reply #7 on: August 12, 2013, 05:51:32 AM »
TIAA-CREF Large Cap Value is not an index (the link above), it's actively managed. You may have some less expensive options in your plan, including index funds. TIAA funds are more expensive than Vanguard's, but they are on the low end of things compared to other fund companies. Your TIAA rep will tell you more. Have him or her do an asset allocation for you, but do not select the option where they manage your money. That costs extra.

emabrook

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Re: TIAA Creff??
« Reply #8 on: August 15, 2013, 05:57:18 AM »
pbkmaine, thank you for your time in answering...

Back with update:
Put many hours of reading the MMM blog and boggleheads wiki.

DH and I sat down with pen and paper and looked up Exp/R for every item in his TIAA portfolio.
Most  were at around  .46 with Real Estate being somewhere like .91.

Not much choice offered by the provider in term of index funds. He was told he cannot move anything out of TIAA unless he quits his job.  Have an appointment with the rep next week.

So the plan now is contribute minimum and start a Roth for DH with Vanguard.

We are having a bit of a problem calculating our retirement goal though.
DH has the TIAA and also a state retirement plan that will pay 60% of his last two years pay.

However, his employer does not contribute to SS, instead they have a mandatory SS plan thru the employer that lists current crediting rate at rate at 4.063% and a guaranteed rate of 3% (still don't understand what it means long term).

Will he  still receive some regular SS since he put many years of work prior to starting with current employer?
Can anyone suggest where I can get help calculating/estimating the SS payments?




matchewed

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Re: TIAA Creff??
« Reply #9 on: August 15, 2013, 06:16:56 AM »
Sure you may not be able to move anything out as it is a retirement investment vehicle. But you can choose more reasonable funds to invest in within your TIAA Creff.

https://www.tiaa-cref.org/public/tcfpi/InvestResearch

Make sure Mutual Funds is the only thing checked off, I'm assuming only retirement class also.

In the drop box below the risk slider you can change it to fees and expenses. Then click the Gross Expense filter until you have sorted it by the lowest Gross Expense. The top return is https://www.tiaa-cref.org/public/tcfpi/investment/profile?symbol=299525 which has .32% in gross expenses. It's not the best but it's better than what you're already invested in.

I am a bit confused though. Are we talking about TIAA Creff for an after tax account or are we talking about one of your retirement accounts?

emabrook

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Re: TIAA Creff??
« Reply #10 on: August 15, 2013, 10:48:13 AM »


I am a bit confused though. Are we talking about TIAA Creff for an after tax account or are we talking about one of your retirement accounts?

In regards to my DH, we are talking about before tax TIAA accounts through his employer.

Is that what you are asking?

matchewed

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Re: TIAA Creff??
« Reply #11 on: August 15, 2013, 10:50:18 AM »
Yes that's what I'm asking.

Well in that case what I'm saying is still valid as long as it is an option provided.

emabrook

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Re: TIAA Creff??
« Reply #12 on: August 15, 2013, 11:07:54 AM »
Sure you may not be able to move anything out as it is a retirement investment vehicle. But you can choose more reasonable funds to invest in within your TIAA Creff.

https://www.tiaa-cref.org/public/tcfpi/InvestResearch


The  Tiaa invest/research link you sent is very straightforward.
 
Last night my DH and I were clicking on each option listed in the drop down menu (from within his account online), than would click on another link that would open another pop up window with the "fine print" such as Exp/R.
Needless to say, it took us a while to go through the options allowed and examine performance & costs :-)

matchewed

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Re: TIAA Creff??
« Reply #13 on: August 15, 2013, 11:40:54 AM »
I'm not sure how it works for the TIAA Creff. The funds which Traditional 401k plans have are decided between the employer and the company the 401k is with. My assumption is either your DH has access to any of those options or that there is some agreement between his employer and TIAA Creff. There should be some literature or information which will guide him to what specific options he has available in his account.

naners

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Re: TIAA Creff??
« Reply #14 on: August 28, 2013, 06:36:34 PM »
Are you sure there are NO index funds? My employer (a university) also uses TIAA-CREF for our 403(b), and there are a reasonable number of index funds with fees around 0.18%. Not what you'd get on your own at Vanguard, but not shabby either especially compared so some people's crappy 401k's. But it may depend on your husband's employer. Maybe he could campaign for some index funds to be included in the available investments! In any case, it's worth calling TIAA to ask, I had a hard time figuring out what investments were available to me until I did that.

CB

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Re: TIAA Creff??
« Reply #15 on: August 28, 2013, 08:13:52 PM »
Are you sure there are NO index funds? My employer (a university) also uses TIAA-CREF for our 403(b), and there are a reasonable number of index funds with fees around 0.18%.

I'm also a university employee and have no index funds available through our TIAA-CREF.  Best expense ratios are .4%-ish.  I think it really depends on the employer.

pbkmaine

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Re: TIAA Creff??
« Reply #16 on: August 30, 2013, 05:58:02 AM »
CB, you don't have CREF Equity Index as an option? It's a Russell 3000 index, essentially indexing the entire US stock market. You could compare it to Vanguard Total Stock Market Index. I am surprised, because it is part of TIAA's core lineup.

CB

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Re: TIAA Creff??
« Reply #17 on: August 30, 2013, 09:48:43 AM »
CB, you don't have CREF Equity Index as an option? It's a Russell 3000 index, essentially indexing the entire US stock market. You could compare it to Vanguard Total Stock Market Index. I am surprised, because it is part of TIAA's core lineup.

Yes, that's one of those choices with a .40+ expense ratio.  Seems pretty pricey when VTSAX is .05.

pbkmaine

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Re: TIAA Creff??
« Reply #18 on: August 30, 2013, 02:07:00 PM »
Yes, it is variable annuity rather than a mutual fund. Some annuities are evil, but this one is not. The variable annuity feature lets you turn it into an income stream later. Talk to your TIAA rep about this before deciding against it.

grantmeaname

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Re: TIAA Creff??
« Reply #19 on: August 30, 2013, 05:16:44 PM »
If it's a variable annuity then how is it comparable to a total stock market index fund?

pbkmaine

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Re: TIAA Creff??
« Reply #20 on: August 30, 2013, 06:44:19 PM »
The variable annuity part is unrelated to the investment part. The underlying investments are the stocks of the Russell 3000 index. Index funds can be ETFs, mutual funds, commingled funds, variable annuities and probably a bunch of other things I know nothing about. The fact that this index fund is a variable annuity means that it has different features than a mutual fund. For one thing, it can be annuitized at retirement to return a stream of income.

grantmeaname

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Re: TIAA Creff??
« Reply #21 on: September 02, 2013, 10:41:03 AM »
So it's not really comparable to VTSMX/VTSAX/VTI then? You pay another 35 basis points a year for the option of annuitizing the principal upon retirement?

pbkmaine

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Re: TIAA Creff??
« Reply #22 on: September 02, 2013, 08:20:24 PM »
It's more complicated than that. The VA structure also gives you credits to increase your annuity stream. But it is best to talk with TIAA-CREf to get all the details.