TIAA Offers Lifetime Income For Corporate Retirement Market

TIAA for the first time is offering its guaranteed lifetime income solutions to the corporate retirement market through the TIAA Secure Income Account.

Over its 100-year history, TIAA has paid out more than $500 billion in retirement benefits to millions of people working in higher education and other non-profit, purpose-driven fields, never once missing a payment to annuitants through depressions, world wars and major financial-market dislocations. Now, private-sector companies can provide employees with TIAA’s unique, pension-like guaranteed income for life as part of their retirement plan.

"People are living longer and need help preparing for a secure retirement, yet few corporate defined contribution plans offer the guaranteed lifetime income they need," said Thasunda Brown Duckett, president and CEO of TIAA. “Building on our heritage, we are offering companies of all types and their employees a solution to more efficiently save, invest and ensure those assets last through retirement.”

The TIAA Secure Income Account is a deferred fixed annuity that offers a predictable, steady stream of guaranteed income for life in retirement. Plan participants’ contributions are guaranteed to grow over time and are protected from losing value no matter what the market does.

The TIAA Secure Income Account also provides the flexibility and personalization people have come to expect in their 401(k)s. It is fully cashable during employees’ working years, and they can take the account with them if they leave their employers or the workforce. Employees can choose – but are not required – to turn some or all of their savings into monthly income paychecks for life when they stop working.

They also have the opportunity for more growth and higher amounts of income the earlier and longer they contribute because of the unique way TIAA shares profits with its individual clients. Lifetime income payments may also increase once people are in retirement, which can help offset the effects of inflation. In 2022, for example, many currently receiving income from TIAA fixed annuities are enjoying a 5% increase in their lifetime income payments – the largest bump in 40 years.

TIAA’s 2021 Lifetime Income Survey found that more than 70% of workers say they would choose to work for, or stay with, a company that offers access to guaranteed lifetime income in retirement compared to one that doesn’t.

The TIAA Secure Income Account is specifically designed to be used as an allocation within managed accounts or custom target-date model portfolios in 401(k) plans. And as part of a plan’s Qualified Default Investment Alternative (QDIA), it can turn participant inertia into an advantage, enabling plan sponsors to automatically direct plan participants to a product with principal protection, guaranteed growth, low volatility and lifetime income with potentially increasing payments. Employees who choose to annuitize will not pay any expenses or commissions.

“We know lifetime income solutions have the power to transform defined contribution plans, because it elevates them from simple savings accumulation vehicles into true retirement investing and payout plans,” said Colbert Narcisse, TIAA’s chief product and business development officer. “TIAA is committed to helping create secure retirements for everyone and will continue to pursue this mission through product innovation, advocacy and education.”

The TIAA Secure Income Account is available through the defined-contribution investment-only distribution channel overseen by Nuveen, TIAA’s asset manager. It is the first in a series of innovative lifetime income solutions TIAA plans for a variety of retirement savings vehicles, including employer-sponsored and individual IRAs.

It leverages the investment management expertise of Nuveen, TIAA’s asset manager, which has been an income provider for 120 years. Nuveen offers a comprehensive range of outcome-focused investment solutions designed to secure the long-term financial goals of institutional and individual investors.