TIAA stand for Teachers Insurance and Annuity Association. Cref stands for College Retirement Equity Fund. Many teachers/educators are effectively forced to contribute to the TIAA-Cref Employer Retirement Plan. I had no complaints about TIAA-Cref until I decided I wanted to rollover my entire TIAA-Cref retirement account into a private Roth IRA. I worked at Houston Community College for many years and TIAA-Cref has made it next to impossible for me to transfer all my contributions to Fidelity. They require you to fill out multiple error prone forms and snail-mail them to a third-party for verification. The people in Houston are rude and of no assistance, but in the name of fairness and journalistic neutrality please read this article about a CREF account holder who had a hassle free experience and easy time of withdrawing their money from their retirement account.
The delay and stall tactics of TIAA forced our family to borrow from a disreputable lender in order to make a down payment on our dream home. The interest rate was way too high, but we had no choice because TIAA is making it a struggle to WITHDRAW our money!
I have contributed to TIAA-Cref in more than one state, but have had a teaching job for 6 years now that contributes to another retirement entity. When I contacted TIAA-Cref about rolling over my retirement funds in personal IRAs, I was told I would have to get “third party” administrators at all the Colleges/Universities of my employment to approve the rollovers.
In my case, this would have involved filling out 4 sets of forms and snail mailing each set of forms to each of the four retirement account administrators at the schools of my employment! The money deducted from my paychecks and deposited into any retirement account is mine and I should NOT have to fill out a ton of error prone forms which require the approval of ANYBODY! I went through a similar process with JP Morgan of rolling over a 401K into a private IRA at Charles Schwab and it went smooth as silk with absolutely no hassles. In fact, I consummated the entire rollover online!
If your are as frustrated as me at not being able to easily access money that is yours from TIAA-Cref, Carranza Pryor is the Director, Associate General Counsel, Litigation for TIAA-Cref in Charlotte,NC.
Sometimes, the only way to eradicate absurd policy is to file a lawsuit and based on what I have been reading there are plenty of irate TIAA-Cref account holders that are upset about the excessively form based policies of TIAA-Cref. Moreover, one should not have to get permission from anybody to collect money that is theirs. What TIAA-Cref is doing is tantamount to borrowing and not paying back their obligation. They full well know that it is a big hassle to fill out all the paper work and make the necessary contacts. In the interim, they are holding YOUR MONEY that much longer and earning interest THAT MUCH LONGER……Not unlike the financial game that American Express plays with its card holders and merchants.
I am closing with a long list of folks who have from minor to serious grievances with the way TIAA-Creff operates. Many of the comments come from Flexo’s excellent blog titled Consumerism Commentary :
I’m just a regular but fairly well educated non-tenure, non-teaching university professor (librarian) who has worked at universities for 37 years. For the past 25 years I’ve been paying into TC and touting their strong commitment to helping the educators of the US. TIAA-Cref made some very big changes during those years including their level of commitment to supporting educators, and for at least a decade their “.org” status is a misnomer. Even so, I continued paying into the TC retirement system. I also, unfortunately, have lived in one of those states where there have been no raises for state university employeesfor the past five years. This means every penny is important to me now that I’ve retired. I retired at the end of spring semester (end of April) and have yet to see one cent from TIAA-Cref.
I made my guesses on the options offered to me for payouts — in my opinion they offer very little in writing about the various options and offer little to no guidance one would expect in the form of a personal financial advisor. I filled out (and am *still* filling out) all of the paper work and have returned it in a reasonable time frame, especially considering most of it has to go through HR people on campus for certification and being notarized. It seems that every time I return properly filled out forms, a few weeks later they come across yet another that has to be filled out before they can begin disbursing any funds. From the dates I been given recently, it will be at least mid-August before I have a chance of seeing anything — early June was their first estimate — and the value of my savings will not be set until after *all* the paperwork is in. (This is a concern because as the stock market continues to decline because of the debt limit political crisis the value of my retirement account — and thus my monthly payment — continues to decrease in value.) If they find more forms to be filled out, certified and notarized it will be September, at the earliest, before I see any funds. I’ve followed the rules, gotten things returned correctly filled out and in a timely manner, and now it’s beginning to look like I won’t receive anything for at least the first four months of retirement — not quite the rosy picture that had been painted before retirement.
If anyone is considering electing to use TIAA-Cref as their retirement vehicle, let me suggest they do at two things before making their decision: 1. talk to at least three *retired* TIAA-Cref members to see what their experiences have been, and 2. if they decided to go with TC, start setting aside a *cash* retirement fund, one that is held in a bank or credit union or under the mattress (remember that for each $100.00 you give the bank for a year, they’ll give you a whopping buck and a quarter return at the end of the year), to tide you through the period of early retirement while TC keeps finding additional forms that have to be filled out before you can receive any funds. END Comment 1
As I read this, I cannot believe how similar it sounds to my experience; in fact, I eventually contacted the TIAA-CREF Board of Trustees in order to get a withdrawal request honored. In addition, I was never told by the various representatives that I could wait a few months and draw(in one lump sum at the age of 65) the total amount. Instead, I was only told that I had to annutizeover 9 years. I am more fortunate than the situatiion cited above because it took one week shy of two months to get the first amount of a nine year payout. Why not contact the CEO or the Board about this problem?END Comment 2
I also have moved into the camp of the horror of trying to get my money out of TIAA-CREF. I called to get information on a withdrawal. The woman answering said the form could NOT be sent electronically but had to be via surface mail. After a few days, after the date she assured me by which I would receive the form, I got no form. I called again. The man answering said he could send it to me electronically, which he did, and would walk me through how to fill it out, which he did, while I took notes. I printed out the form, filled it in, put a stamp on it for the oversize, mailed it. After a few days, I checked the status. The man answering said there were errors on it and I needed to fill out a new form. By this time I, ordinarily a calm, polite, controlled person, lost it. Plus he could not send me the form right then as he would fill out most of it electronically but I should get it via email the next day. Right now it’s almost two weeks since I made the first request. Each person I speak to gives me a different answer. I need the money now. This company appears to be in almost total disarray. Get all of your money out ASAP. That’s what I intend to do as soon as I straighten out this instant mess, assuming it will be.
You can file a complaint with the Better Business Bureau online in about ten minutes (google “better business bureau” and “complaint”). The electronic funds transfer for my withdrawal (after more than a month of failed tries) was initiated the same day they(TIAA-Cref) received my complaint from the BBB, which was just a couple of days after I filled out the online complaint form. You should make sure you keep record of the dates you interacted with various representatives, mailed things, etc.END Comment 4
Of course TIAA-Cref are nice to you if you want to keep their high fees and low returns. Perhaps P.T.Barnum said it best. But try to pry your funds out of their sticky hands and you will get the full horror show.END Comment 5
I worked at an institution that contributed to a cref account on my behalf for two years. I have moved elsewhere, and I have another retirement account (roth IRa). I am currently trying to withdraw (after an initial failure and the complexity of rolling over to a roth IRA). I sent in forms that were declined by TIAA-Cref because the signatures were over 90 days old (I had to get a notarized signature from my wife who was out of state at the time, a signature from a past employer in another state, neither more wife or I had easy access to fax, so we used the mail, and my wife and I have other jobs to do!).
I received a call and was told I could sort it over the phone when I could get to the internet. When I was able to get to my computer and call, this was not the case. Rather, I was told I had to complete hard copies of the same forms over again along with a tax form, but I wouldn’t have to redo signatures other than my own. Apparently I didn’t need my wife’s signature, because the amount was small enough, but the form should say that, because getting a notarized signature can be a pain for people that work in the middle of nowhere for large chunks of the year! I was told by the rep that he would send me a pre-filled form electronically that I would simply have to print, sign and mail. When that didn’t happen, I called again, and I was told that I did have to get a signature from my former employer (the previous rep had told me I didn’t have to). I just want my money.END Comment 6
I have also experienced the same headaches and hassles enumerated here. I dealt with a “very nice” Customer Resolution Specialist who also indicated I would have to fill out voluminous forms and get notarized signatures from third party administrators. It has been over 8 years since I worked at place that was affiliated with TIAA Cref! I want my money this sucks! I think their lawyer is Carranza Pryor. It may take a class action law suit to change their idiotic policy!END Comment 7
My father worked in academic medicine and, as a result, had 403B retirement accounts with TIAA-CREF for over 50 years. He passed away in December 2008. We immediately established an IRA at TIAA-CREF for my mother, the named beneficiary, to receive the 403B account funds, which were (according to TIAA-CREF’s online account access system) successfully moved to her IRA in 2009.
In December 2010, as we attempted to arrange a Required Minimum Distribution (RMD) from my mother’s IRA, TIAA-CREF informed us that the distributions in 2009 were not completed properly and everything needed to be reversed to enable TIAA-CREF to start the process from the beginning. Of course, with the online system completely at odds with this news, I involved my mother’s accountants. With only a few days left in the tax year, TIAA-CREF moved all funds back to my father’s name (he had then been deceased for 2 years), paid an RMD from his accounts (twice as much as would have been paid from my mother’s IRA), and then distributed the funds to my mother’s IRA. TIAA-CREF acknowledged its errors and promised to reimburse my mother’s additonal costs.
Now, 8 months later, TIAA-CREF is refusing to reimburse my mother’s out-of-pocket costs, which are about $25,000 ($18,000 in additional 2010 income taxes plus legal and accounting fees). I have filed complaints with the SEC, the state Office of Financial Regulation, two state senators, and my father’s two prior employers, and I have an attorney poised to sue.
It is remarkable to me that a large institution like TIAA-CREF is actually attempting to get away with this type of abuse. I suppose that the company believes the legal fees for my mother to litigate would be too high for $25,000 in controversy. We’ll see. I am one who believes in doing the right thing, even if it costs to see justice prevail.
Suffice it to say that, anyone doing business with TIAA-CREF does so at his or her own financial peril. The company is unscrupulous in its business relationships with retirees and their beneficiaries. A totally despicable organization in my experience.