Greg Shepard – S&A Financial Services, Inc.

For those of you familiar with my podcast, HigherEd Retire, I’ve mentioned more than a time or two that I’m NOT a fan of TIAA Traditional (guaranteed) account. Well, I’m officially contradicting myself.

These rates are just too high to ignore. COULD be a good place, especially in SRA accounts (due to liquidity), to place money in leu of cash / bonds. Take a watch and let me know what you think. Also, feel free to listen to my podcast episodes and join my private LinkedIn Group specifically for those in higher education.

🎤 HigherEd Retire Podcast episodes

📆 Jump on my calendar to discuss your higher ed retirement plan situation.

email: greg@shepardfinancial.com

**Disclosure** S&A Financial Services, Inc. is a registered investment advisor. Content presented is for informational purposes only and should not be considered as investment advice or as an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Always consult with your tax advisor or attorney regarding your specific situation….(read more)

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TIAA Traditional – Advisor’s Changed View

TIAA Traditional is a fixed annuity product offered by TIAA, an American financial services organization. It has often been recommended by financial advisors as a safe and secure investment option for those nearing retirement. However, recent changes in the investment landscape have led some advisors to reevaluate their view on TIAA Traditional.

One of the main reasons why advisors have traditionally recommended TIAA Traditional is its stability and steady returns. The product guarantees a minimum interest rate and protects the principal from market fluctuations. This has appealed to conservative investors who prioritize the safety of their retirement savings.

Historically, TIAA Traditional has been able to provide competitive returns, often outperforming other fixed income options. This has made it an attractive choice for those who are risk-averse and want to ensure a reliable and consistent income stream during retirement.

However, the low-interest-rate environment over the past decade has made it challenging for TIAA Traditional to maintain its previous level of returns. With interest rates at historic lows, the guaranteed minimum interest rate offered by the product has also decreased. This has prompted financial advisors to reevaluate their recommendation of TIAA Traditional as a viable investment option.

Additionally, the COVID-19 pandemic and the resulting economic uncertainty have raised concerns about the long-term financial stability of insurance companies like TIAA. While TIAA has a strong track record and has been able to weather financial crises in the past, the unprecedented nature of the pandemic has added a layer of uncertainty.

As a response to these changing circumstances, some financial advisors have started to explore alternative investment options for their clients. They are diversifying their recommendations to include a mix of fixed income securities, dividend-paying stocks, and real estate investment trusts (REITs) that can potentially provide higher returns in today’s low-interest-rate environment.

While TIAA Traditional still has its merits for certain investors, the changing investment landscape has prompted financial advisors to reassess its role in their clients’ portfolios. They are now advocating for a more diversified approach that can better adapt to the current economic climate.

It is important for investors to consult with their financial advisors to discuss their specific financial goals, risk tolerance, and time horizon. Advisors can provide personalized recommendations that take into account the individual’s unique circumstances and help them navigate the evolving investment landscape.

In conclusion, the changing investment environment has led financial advisors to reevaluate their view on TIAA Traditional. While the product has historically provided stability and competitive returns, the low-interest-rate environment and economic uncertainty have prompted advisors to explore alternative options. Investors are encouraged to seek advice from their financial advisors to navigate these changes successfully and build a well-rounded investment portfolio.