NEW YORK, February 24, 2022 – TIAA’s innovative RetirePlus Series® has surpassed $10 billion in assets thanks to dozens of new institutional clients, additional individual client contributions and consistent investment performance. This 45% year-over-year growth demonstrates a strong interest in customizable retirement plan options that provide access to guaranteed lifetime income through a QDIA (Qualified Default Investment Alternative)-eligible default solution.
“Over 40% of all U.S. households are expected to run out of money in retirement with an average shortfall projected at $100,000 per household,” said Bill Griesser, head of Institutional Managed Solutions at TIAA. “TIAA RetirePlus Series helps plan sponsors better prepare their employees for a confident retirement by allowing them to create a ‘personal pension1.’ It brings the lifetime income provisions of the Secure Act into practical reality for plan participants."
The TIAA RetirePlus Series allows plan sponsors and their consultants to create model portfolios rather than rely on standard, off-the-shelf target date funds. By combining the simple efficiency of a target date structure with the flexibility to select investments from the existing plan, it can lower administrative costs and fees and, if included, TIAA Traditional can serve as the fixed‐income portion of the portfolio, providing access to guaranteed income for life. And with five generations in the workplace, each in different life-stages, TIAA RetirePlus Series model portfolios can be tailored to a plan’s unique preferences and diverse employee base.
“Our experience and research show that custom defaults in retirement plans tend to boost overall retirement readiness for participants,” said Ben Lewis, head of Institutional Strategic Sales. “By selecting TIAA RetirePlus Series model portfolios as the default option, plan sponsors can simplify investment selection, enhance plan efficiency and boost participant retirement security at the same time.”
According to the TIAA Annuity Center of Excellence, participants that contributed to TIAA annuities over their career received nearly 18% more income than participants who did not. Through its unique ‘sharing-the-profits’ approach, TIAA seeks to reward participants with additional income based on the length of time of the contributions – like a “loyalty bonus.”2,3
One prominent plan sponsor altered its plan to provide every employee with a more secure retirement for the rest of their lives. The plan sponsor replaced its default target date funds with model portfolios tailored to their employee demographics through the TIAA RetirePlus Series. Two years after implementation, the results speak for themselves: the institution experienced an increased average projected retirement account balance of $87,000, improved risk-adjusted returns, and increased average projected retirement income by 24%.4
Plan sponsors that add RetirePlus Series models to their plan can choose between TIAA RetirePlus® and TIAA RetirePlus Pro®, depending on their desired flexibility and level of customization. Each option can include a fully liquid annuity component for lifetime income.
TIAA RetirePlus offers a set of predefined asset allocation models used by plan sponsors to create risk-appropriate defaults using the investment options on the plan’s core menu. TIAA RetirePlus Pro allows plan sponsors to work with advice from a 3(21) fiduciary advisor or to delegate asset allocation to a 3(38) investment manager to customize all aspects of model attributes.
TIAA is a leading provider of secure retirements and outcome-focused investment solutions to millions of people and thousands of institutions. It is the #1 not-for-profit retirement market provider5, paid more than $4.2 billion to retired clients in 2021 and has nearly $1.4 trillion in assets under management (as of 9/30/2021)6.