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Valued Contributor

TIAA Traditional Rates, October 1, 2019

September 30, 5:30 pm Central: Strange that TIAA hasn't posted new rates for October. Typically they are posted about half-hour after the market close at the month-end. The links below should show new rates when updated. I will keep checking this evening but the TIAA offices are probably closed now and the person in charge of updating this data may have gone home or may be on vacation.

Edit/Add:

Not updated as of October 1, 5:45 am Central time.

Not updated as of October 1, 8:15 am Central time.

At 8:45 am Central, I called TIAA and alerted that the rates were not updated for Oct and the Rep promised to get it fixed soon.

Info updated around October 1, 11:20 am Central.

RC, RA, RCP accumulation rates are up. SRA and Newer IRA accumulation rates are same.

Payouts for the latest vintage have gone up too.

RC 3.50%  https://www.tiaa.org/public/investment-performance/tiaatraditional/profile?ticker=47933637

RA 3.25%  https://www.tiaa.org/public/investment-performance/tiaatraditional/profile?ticker=47933630

RCP 2.75%  https://www.tiaa.org/public/investment-performance/tiaatraditional/profile?ticker=47933638

SRA 3.00% [min]  https://www.tiaa.org/public/investment-performance/tiaatraditional/profile?ticker=47933631

Newer IRAs 1.30%  https://www.tiaa.org/public/investment-performance/tiaatraditional/profile?ticker=47933634

INCOME PAYOUT RATES FOR LIFETIME ANNUITIES ISSUED DURING NOVEMBER 2019VINTAGE(WHEN MONEY WAS CONTRIBUTED) LIFETIME INCOME PAYOUT RATESINGLE LIFE WITH 10-YEAR GUARANTEE LIFETIME INCOME PAYOUT RATEJOINT LIFE WITH 20-YEAR GUARANTEE

2012 - 20195.8%5.0%
2002 - 20116.3%5.5%
Pre-20027.9%7.0%

An income payout rate represents the amount of annual income you will receive as a percentage of the amount you convert to lifetime annuity payments.

The examples shown above are based on a 65-year-old choosing a single life annuity with a 10-year guarantee period or a joint life annuity (with full benefit to survivor) with a 20-year guarantee period. Income payout rates for each participant will vary by age, the annuity partner’s age (for joint options) and the income option selected. Note that participants who contribute to TIAA Traditional over the long term may receive higher income amounts, since they would get the rates applicable to the older vintages as shown above.

Figures shown above are based on the TIAA Traditional Standard Payment Method.

YBB
10 Replies
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Follower ○○

Re: TIAA Traditional Rates, October 1, 2019

I should have probably checked here first, but I annuitized a significant amount (to me, about 20% of my 403b holdings) on 9/13/19 partially because my "wealth manager" expected rates to go down.

Unfortunately I did not record the rates that day, and have not looked at the rates today.

I selected the "graded" payout. It looks like only about 40% of my TIAA traditional holdings actually qualified for graded.

My TIAA advisor was surprised I choose graded payout. Apparently most of his customers choose normal payout. For me this is partly to help cover expenses while I wait to claim SS, and partially so that combined with SS I have an increasing payout for the rest of my life, and my spouses life, in case one of lives a very long time.

I hope I made the right decision. I figure in the end it all works out. TIAA traditional is a big black box to me.

I am a little disappointed they guarantee 3% during accumulation, but only 2.5% during payout.

 

In theory my payout could decrease with time. But I do not think that is likely . . . It likely will not keep up with future inflation, but hopefully choosing the graded option will at least take a bite out of inflation . . .

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Explorer ○○○

Re: TIAA Traditional Rates, October 1, 2019


@dknightd wrote:

My TIAA advisor was surprised I choose graded payout. Apparently most of his customers choose normal payout. 

In theory my payout could decrease with time. But I do not think that is likely . . . It likely will not keep up with future inflation, but hopefully choosing the graded option will at least take a bite out of inflation . . .


I also chose the graded-payout annuity for all of my funds that were earning the minimum required rate (4%).  That was six years ago.  Currently, the only vintages that are earning more than 4% are those contributed before 2002.  They are earning 4.4%.  So the only contributions that will go to purchase additional Traditional annuity are those made before 2002.  If you have some of that vintage, your graded payments will rise in January.  If all your contributions were 2002 or later, the graded method will be no different from the standard method.  You definitely have not hurt yourself by choosing graded.

To see rates of vintages, and two samples of annuity payout rates go here:

https://www.tiaa.org/public/investment-performance/tiaatraditional/profile?ticker=47933632 

John

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Explorer ○○○

Re: TIAA Traditional Rates, October 1, 2019

When composing my previous post, I noticed that TIAA's sample payout rates are for October annuities, but their accumulating rates have still not been updated for October.  That's strange.

John

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Valued Contributor

Re: TIAA Traditional Rates, October 1, 2019

TIAA just updated the rates for October - the OP has been revised.

RC, RA, RCP accumulation rates are up. SRA and Newer IRA accumulation rates are same.

Payouts for the latest vintage have gone up too.

YBB
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Valued Contributor

Re: TIAA Traditional Rates, October 1, 2019

Yogi writes:

"RC, RA, RCP accumulation rates are up. SRA and Newer IRA accumulation rates are same.

Payouts for the latest vintage have gone up too."   (my boldface)

How counterintuitive is that?!

I can only deduce that  TIAA considers itself in a strong position.

Bob

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Valued Contributor

Re: TIAA Traditional Rates, October 1, 2019


@jjustice wrote:

When composing my previous post, I noticed that TIAA's sample payout rates are for October annuities, but their accumulating rates have still not been updated for October.  That's strange.

John


It is updated now for accumulation rates in October and payouts in November [that is when new payouts start].

YBB
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Follower ○○

Re: TIAA Traditional Rates, October 1, 2019


@jjustice wrote:

@dknightd wrote:

My TIAA advisor was surprised I choose graded payout. Apparently most of his customers choose normal payout. 

In theory my payout could decrease with time. But I do not think that is likely . . . It likely will not keep up with future inflation, but hopefully choosing the graded option will at least take a bite out of inflation . . .


I also chose the graded-payout annuity for all of my funds that were earning the minimum required rate (4%).  That was six years ago.  Currently, the only vintages that are earning more than 4% are those contributed before 2002.  They are earning 4.4%.  So the only contributions that will go to purchase additional Traditional annuity are those made before 2002.  If you have some of that vintage, your graded payments will rise in January.  If all your contributions were 2002 or later, the graded method will be no different from the standard method.  You definitely have not hurt yourself by choosing graded.

To see rates of vintages, and two samples of annuity payout rates go here:

https://www.tiaa.org/public/investment-performance/tiaatraditional/profile?ticker=47933632 

John


I started work 9/1/1988, I retired 9/1/2019. 31 years. I have a mixture of vintages. TIAA can change the interest at any time, for reasons only they (hopefully) understand. When I read the contract they could even make it less than the 3% current interest (or 2.5% in payout phase) if they wanted. I just have to trust them. They spend more in 2019 than they did in 1988 on advertising. But I suspect, hope, they want to keep their old customers happy. They have a pretty good record of doing that. Fingers crossed.

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Valued Contributor

Re: TIAA Traditional Rates, October 1, 2019

dknightd,

Congratulations on your recent retirement!

Bob (in year 20 of retirement)

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Follower ○○

Re: TIAA Traditional Rates, October 1, 2019

Thanks. I'm hoping my decisions will work out in 20, 30 or 40 years

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Participant ○

Re: TIAA Traditional Rates, October 1, 2019

Thanks,  Yogi - an unusual start to the month.  Thanks for calling TIAA.

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