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Robb
Follower ○○

Annuity Income from Standard 2019

Hi-

I'm trying to predict my annuity income for 2020. I learned last year from TIAA that graded income increases for 2019 depended on the standard annuity income increases for 2018. In other words, graded annuity income changes depend on what standard income did the previous year.

I've been looking online what the standard annuity income change was for 2019. I was only able to find that the Standard Payment Method for 2018 increased about 1% for 2018, which accounts for my larger increase in Graded Payment for 2019.

What was the increases for Standard Payment Method for 2019? Thanks very much.

Rob

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7 Replies
GLI2019
Contributor ○

Re: Annuity Income from Standard 2019

Robb,

I am Traditional standard and for 2019 did not receive any increase in  "additional income."

Bob

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Robb
Follower ○○

Re: Annuity Income from Standard 2019

Thank you, Bob. That means my 2020 increase will be minimal. 

Regards, Rob

 

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jjustice
Explorer ○○○

Re: Annuity Income from Standard 2019


@Robb wrote:

I'm trying to predict my annuity income for 2020. I learned last year from TIAA that graded income increases for 2019 depended on the standard annuity income increases for 2018. In other words, graded annuity income changes depend on what standard income did the previous year.


I don't think that this is correct.  Your graded payments increase because any interest earnings above 4% in your own annuitized funds is re-invested in Traditional, rather than being a part of your pay-out.  So the amount of increase will depend on vintage pay-out interest rates, the rates which re-invested funds earn, and how much you have in the various vintages.

I also have graded payout.  I think that given the declining vintage rates and the lower current rates at which re-investment earns, we can expect the bump to be a little smaller than last January.  But the size of the increase will depend on the individual's account.

John

 

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Robb
Follower ○○

Re: Annuity Income from Standard 2019

John,

I'll quote a reply I received from a TIAA Customer Resolution Manager when I asked why my 2018 graded annuity income increase was only 1% , and my 2017 graded annuity income increase was close to 2%.

The reply from the TIAA rep in January 2018: "Graded renewals are partly based on the Standard renewal rates for the previous year.  As such, you should not be comparing your Graded payments to Standard increases for 2018 but rather, for 2017. In 2017, Standard had no increase. So while Graded had an increase in 2018, it is smaller.

The Standard increase in 2018 bodes well for a larger Graded increases in 2019. "

What the TIAA rep wrote above seems to indicate that your graded annuity income will be increased more than normal if the standard from the previous year is increased. As an example, the Standard annuity income increase for 2017 was 0, so the graded income I received was only a little higher (1%). The Standard income for 2018 was higher, so the graded for 2019 was significantly higher (2%). From what I hear, the Standard income increase for 2019 was 0, so the Graded income increase for 2020 would be a little lower.

Rob

 

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TheWizard
Explorer ○○○

Re: Annuity Income from Standard 2019

No offense to Rob, but right now is about the time I try to firm up my 2019 income, for certain tax related reasons.

A couple months from now, I'll do my income taxes and do some updates to my income spreadsheet for the next few years.

That's how I do it...

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yogibearbull
Valued Contributor

Re: Annuity Income from Standard 2019

TIAA call center may be providing simple answers for general callers.

Graded kicks in only for vintages that pay over 4% and that may be a small fraction now [ @jjustice is right on that]. So what the call center may be saying is that until current and other under 4% vintages catch up with increases to 4%+, don't expect much for increases from graded option.

YBB
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Robb
Follower ○○

Re: Annuity Income from Standard 2019

Thank you very much. That helps.

Rob

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