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Frequent Contributor

Re: How much TIAA Traditional?

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Always good to hear from younger folk, Oldzey.

Once upon a time I was 70/30.  Not anymore. 😁

Bob

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Re: How much TIAA Traditional?

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My wife (75) and I (80) have 28% of our total retirement assets (which include more than TIAA) in TIAA Traditional.

Like Pete, we consider our TIAA Traditional as a reserve to be used if needed for LTC, but would rather be able to leave it for our children. 

benjamin

 

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Re: How much TIAA Traditional?

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We have Long-Term Care Insurance (LTCI), which is expensive, but so is long-term care. If we needed to supplement the insurance we'd probably find the money in a separate set of funds that we hold at Fidelity (brokerage and IRA). That money came partly from my contributions from salary to an SRA and partly from inheritance.

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Re: How much TIAA Traditional?

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TIAA Trad is currently 26% of our total portfolio; 80% of which is in the flexible GSRA accounts.I’m in my 3rd year and DW is in her 6th year of retirement. So far RMDs and Soc Sec have taken care of our modest expenses, so annuitizing has not been a serious consideration with one important exception.

The college I retired from required me to annuitize a slice of the pie to guarantee payment for supplemental health care benefits.  I receive the funds from TIAA and reimburse the union for the health insurance plan. 

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Re: How much TIAA Traditional?

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40%

One of these days plan to take dividends for income.  turned 66 this month, statsgal will be 66 in a couple of months.  don't need more income right now so maybe will start taking TIAA Traditional when required.  I think that is now 72.

stats

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Re: How much TIAA Traditional?

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Hi,

Summary:

Holder%Notes
yogibearbull  71.0Sold TREA
NSkipper  54.0Sold TREA
JayS  52.0Decreasing
Statsguy  40.0 
jjustice  37.5Ranger 35 - 40
GLI2018  37.535 - 40 of Income
phenders  33.3For LTC
oldzey  30.0Target
benjamin  28.0For LTC
BrianG  26.0 
51hh  25.0 
CarlosDS  20.0 
Aquinas  16.0 
klucsamj  14.0After Tax Annuity
Juris2  12.0 
Intruder    6.0 
Learner???No Number Given
   
Average  31.4 

 

S

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Re: How much TIAA Traditional?

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Thanks to everyone for information about the percentage of TIAA Traditional you hold in yours retirement accounts--especially to NSkipper for compiling the data in a list.  I found the discussion illuminating and was somewhat surprised that my percentage was on the low end.  I'm contemplating moving some CREF Money Market funds into Traditional, so the discussion gave me food for thought.

Like Pete, my wife and I see our Traditional to some extent as longevity insurance and a LTC policy (part of our Traditional is in an ATRA).  If we need the funds for LTC, they will be there. If not we will pass them on to our heirs.  --Aquinas

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Re: How much TIAA Traditional?

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In my TIAA holdings, I'm presently around 38% Trad, yielding 3% or more. The rest is in stock funds.

This is a result of selling out of TREA a few months ago. Prior to the sellout, I was close to 10% Trad, 28% TREA and the rest stock funds.

I should mention that my Roth IRA and taxable account at Vanguard are close to 100% stock funds, but they total only about 25% of my tax deferred TIAA funds...

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Re: How much TIAA Traditional?

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That's a very impressive move, Wiz. Are you now taking RMD's? If so, from where?

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Re: How much TIAA Traditional?

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>But I put 25% of my TIAA-CREF 403b contributions from salary into Trad beginning in 1975.

I started the same time.  The advice I followed was 25% Trad and 75% CREF Stock.  As I recall back then those were the only two TIAA CREF options.  The financial world has changed significantly since then.

Pete

 

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Re: How much TIAA Traditional?

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@phenders wrote:

>But I put 25% of my TIAA-CREF 403b contributions from salary into Trad beginning in 1975.

I started the same time.  The advice I followed was 25% Trad and 75% CREF Stock.  As I recall back then those were the only two TIAA CREF options.  The financial world has changed significantly since then.

Pete


+1. Except, I only started in 1981 with 50:50 and slowly moved to 75:25 (Stock:Trad) in 1985 and maintained it for a long time. Since the university paid 10% towards RA and I used GSRA to fund with 15% of my salary and reduced it to 10% towards end because I also started a state supported 401(k) account. However, I started my TPA to IRA and then IRA to ROTH starting from 2005 because I moved to TCRS. I used CREF money to fund my TCRS funding. Besides, I used TIAA money from SRA to fund some of my TCRS funding. Once TPA was completed, I moved all my assests to Vanguard in 2015 and consolidated into my brokerage account.

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Re: How much TIAA Traditional?

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75/25 starting in 1968 based on my FIL's advice. Pretty much left it alone until Real Estate was offered. Approaching retirement definitely downshifted in preparation for annuity income streams.

Without the TIAA-CREF system, I could never have retired at age 58. Every year since then I always remember what ultimately made it possible. The other stuff is mainly bonus points.

Pete is right how about much things have changed. But I seriously wonder how much that change has served the best interests of investors.

Bob

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Re: How much TIAA Traditional?

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Bob, another important factor in your employer's TIAA plan was that you only had to contribute 5% of your gross salary to it, and the employer double-matched that with another 10%. Most universities in the same "league" (read: conference) weren't that generous. I benefited from that 15% annual contribution for 39 years. I retired at age 70.

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Re: How much TIAA Traditional?

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>But I seriously wonder how much that change has served the best interests of investors.

Everything in life in America is more complicated these days.

Far too many choices in almost everything: financial, medical, viewing (TV, movies & streaming), products, groceries, etc.

Being retired I have a bit more time to sort things out, and to help the kids sort things out.

Pete

 

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Re: How much TIAA Traditional?

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Juris, on the other hand, some universities did/do have pension plans.

Phenders, a book on that subject, The Paradox of Choice by Barry Schwartz.

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Re: How much TIAA Traditional?

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Pete,

I don't like to waste a crisis.

I'm afraid my kids are getting an earful from dear old dad about seizing the covid crisis to reassess what truly matters in their lives and what amounts to fluff.  This is an excellent time to get Back to Basics at whatever age.

Bob

P.S. to Juris: of course the 10% match contributed mightily.  As you may know, the U has suspended (I suspect forever) the 10% match.  It will be 5/5.

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Re: How much TIAA Traditional?

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Not to be a "smart a@s" but to represent an unknown % here - 0%. I took all Traditional out decades ago and converted RA to IRA and eventually a lot of Roth. And then TIAA did IRA owners a dirty by creating very unfavorable expenses for IRA holders. And further, they really screwed IRA holders that use to get 3% guarantees for Traditional and now get pittance.

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Re: How much TIAA Traditional?

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@Juris2 wrote:

That's a very impressive move, Wiz. Are you now taking RMD's? If so, from where?


I would be starting RMDs this year but for the new tax law which changed the RMD law to the year you turn age 72, for my age and younger.

For the past several years, I've been doing monthly systematic pro-rata withdrawals from my GSRA, except they are actually Roth conversions, so $xxxx per month transfers into my TIAA Roth IRA. This $xxxx amount is roughly the same as my starting RMD will be.

So starting January, 2022, I will modify this $xxxx monthly pro-rata withdrawal to go to my checking account instead, and to be just over 1/12 of my annual RMD amount...

 

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Re: How much TIAA Traditional?

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@TheWizard ,

I suppose you have had your Roth IRA account longer than five years.  Does each monthly converted amount have its own separate five-year rule?  Even if the answer is yes, you should be able to withdraw the converted amount (but not any earnings) anytime you wish with no problem?  Am I correct?

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Re: How much TIAA Traditional?

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I forgot something in my previous post, and I was reminded by some on the RMDs. Since I converted all of tax deferred cash to ROTH, I do not have that problem during the past five years.

By the way, a lot of folks use CEFs for (almost) steady income instead of annuity income. I learnt of this during the past two years, first by trading several different CEFs and BDCs with small bets - like few hundred shares of different types. Finally, I have settled down on two CEFs (PCI and KIO). PCI is a popular among the many participants in the CEFforum, and many own KIO also. Since the yields are above 9% (APR) or more - currently around 12% (APR), they have been paying me steadily even with this downturn. So, since I own several thousand shares of these, I am having handsome distribution every month along with the qualified dividends from the Vanguard ETFs - more than the sum of my SS+TCRS income. I take distributions and reinvest the cash in the stock ETFs or back into the same that has a good discount. That is how I ended up with several thousand shares because I can buy several hundred shares every month - I mean month. Indeed, I am cutting back on those shares by moving them to some BDCs that are sold at discounts. They also distribute around 12% (APR). Most of good BDCs have also recovered and the discounts have disappeared during the last month and this month.

The advantage of these are: BDCs use low and medium quality debts and charge high interest rates. Therefore, we get high APR.

CEFs are leveraged, and they use bank debt along with the share holder cash. So, this technique boosts the income.

In both, there are risks but so far, this year, I have not seen the risk as a big factor in my income coulmn. Yes, the balance has dropped but the income is based on the number of shares that you own, not the balance in each fund. Besides, the FED rate of zero had a big impact but they are recovering though. Some CEFs have cut the distributions this year. Some have liqudated. So, it is important to choose quality CEFs - something from a good company, such as PIMCO. PIMCO has also some good bond OEFs. Yogi knows more about this.

If you are interested in these, you need to do a thorough investigation as some of us did (me, Yogi, Intruder, and Judger - to name a few - names you are familiar with) before you jump into these types of investments. I think that Yogi is using them as trading vechiles. Indeed, I strated with Intruder's mention of UTG more than two years ago and made some cash. Then, I started spreading my wings into other CEFs and traded them for another year for income and CGs. I stopped selling for CGs since last September and using them for income as most people do. Who wants to kill a goose that lays golden eggs? The income from CEFs and BDCs are ordinary incomes just as annuity income. I rearranged my investments early this year so that the ordinary incomes come from our ROTH accounts. So, the income becomes untaxable, and I still pay about  only 1% of my yearly income.

We are also going to have some tough time this year because the tennant lost his job and moving out next week - on July 31. The rent income will stop until we find a new tennant but the bills have to be paid. That means schedule E loss will go up this year.

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