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Re: TIAA stable fund - good or not? [Competing Funds Requiring Equity-Wash]

Unfortunately there was an error on the TIAA web site. In one account stable value pays 2.3%. In another account it pays only 1.25%. But the web site showed 2.3 for both. Oh well, still better than 0 :) And the difference is actually pretty small. TIAA guarantees 1% in both accounts.

I have faith in TIAA. If they fail, my retirement is basically that of a pauper. . .

 

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Re: TIAA stable fund - good or not? [Competing Funds Requiring Equity-Wash]

dknightd:

You might wish to weigh your concern about TIAA's "failure" against a recent rating by Fitch of TIAA's Surplus Notes:

https://www.fitchratings.com/research/insurance/fitch-rates-tiaa-surplus-notes-aa-04-05-2020

Nothing is without risk, but I shall nevertheless wish you a non-pauperish retirement.  :-)

Bob

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TIAA Surplus Notes


@GLI2019 wrote:

dknightd:

You might wish to weigh your concern about TIAA's "failure" against a recent rating by Fitch of TIAA's Surplus Notes:

https://www.fitchratings.com/research/insurance/fitch-rates-tiaa-surplus-notes-aa-04-05-2020

Nothing is without risk, but I shall nevertheless wish you a non-pauperish retirement.  :-)

Bob


How did you come across this news about Surplus Notes? I didn't see anything on TIAA website. Of course, now when I searched the web  for "TIAA Surplus Notes", I found the above link.

There were $5 billion in Surplus Notes outstanding according to 2019 Annual Report [Note 13]. There was no change in TIAA General Account Q1 [3/31/20] Report in the related Note 13 [No material change]. 

Question is why the additional $1.25 billion in Surplus Notes?

In the past, TIAA issued them when things were bad [2009] or around the times of major acquisitions [Nuveen in 2014, EverBank in 2017]. In 2014 and/or 2017, TIAA also retired some old Notes from 2009. 

So, why the new Surplus Notes now? Was March 2020 really bad? 

There was also recent news about TIAA offering buyouts that applied to 75% of its workforce.

YBB
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Re: TIAA Surplus Notes

Yogi,

Given the stressed circumstances for many financial organizations, I do a general search from time to time for TIAA ratings changes.  This one popped up.

Beyond this, anything I might say is uninformed speculation. 

Bob

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Re: TIAA Surplus Notes

Looking at 2020/Q1, 3/31/20 data vs 12/31/19,

Net Admitted Assets grew by +1.615%  [excluding separate accounts]

Capital & Surplus grew by +0.558%

So, C&S grew slower than Net Admitted Assets but C&S annualized rate of 4 x 0.558% = +2.23% looks OK.

Asset growth came in the categories of bonds, cash/cash equivalents/short-term investments, receivables and derivatives.

I suppose that the need for new Surplus Notes probably arose from internal assessments during Q2.

YBB
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Re: TIAA Surplus Notes

Thanks, Yogi.

Bob

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Re: TIAA Surplus Notes

"Life is like a box of chocolate"

https://www.youtube.com/watch?v=CJh59vZ8ccc

You never know how things will turn out.

My retirement income will eventually be part SS and part TIAA. I like to think one, or both, will be able to provide what I hope they will provide.

At least TIAA is based on what you have. SS depends on what other people decide. With a little bit in both, I expect we'll be OK

add us: http://www.facebook.com/inspiremefilms "Life is like a box of chocolate" a film by: Robert Zemeckis (c) Paramount Pictures http://www.imdb.com/title/...
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