TIAA Traditional Payout Increases 5% For 2022

Beginning in January 2022, lifetime income payments to holders of the TIAA Traditional fixed annuity¹ who opted to annuitize in retirement will increase by 5%, the largest boost in 40 years.

The additional payout of $180 million to clients of the company's flagship offering will bring the total income paid to retirees in 2022 to $3.6 billion. TIAA Traditional has paid more in lifetime income than its contractually guaranteed minimum amount every year for the last 70 years, providing clients who choose to annuitize with a solid foundation of steady, guaranteed lifetime income payments regardless of market conditions.ⁱ All told, TIAA has paid more than $505 billion in benefits since 1918, the year TIAA was founded and 17 years before Social Security began. TIAA's retired clients have never missed a payout.

"For over 100 years, through up and down markets, TIAA Traditional has helped millions of people build a solid retirement foundation through the creation of lifetime income," said Thasunda Brown Duckett, TIAA President and CEO. "We do this through steady financial stewardship, diverse and sustainable investments and a relentless focus on creating secure retirements for people whose purpose is to serve others."

TIAA Traditional is Unlike Other Fixed Annuities

• Guaranteed Growth and Income: TIAA Traditional provides guaranteed growth during the working years people pay into it, which means the value of money contributed is guaranteed to increase every day – even in the most volatile markets. It also provides guaranteed lifetime income by providing the opportunity to turn savings into regular monthly income to help meet everyday living expenses in retirement. It's like getting a "paycheck"ⁱⁱ for life when you stop working.
• Additional Amounts: Along with providing a guaranteed fixed rate, TIAA Traditional offers the potential to receive extra interest and income, declared annually at the discretion of the company's board, as announced today.
• "Loyalty Bonus": TIAA Traditional also offers an exclusive benefit for long-term contributors – a "loyalty bonus" that rewards savers with additional amounts of income based on how long they have been investingⁱⁱⁱ Contributing to TIAA Traditional consistently over a working career can significantly increase payments in retirement, with an average lifetime income advantage of 22.4%.^iv

Returning Profits to Clients

TIAA is private company whose mission is to provide retirement security for educators, healthcare workers, researchers, government employees and others in service. This unique structure and heritage enables a pure focus on serving its plan clients and their employee participants. Profits can be shared with participants through their TIAA Traditional account.^v

The 5% income increase is funded by the strong underlying performance of TIAA's general account, which is the investment portfolio that supports TIAA Traditional's ongoing obligations. The general account is distinguished by financial strength, a highly diversified portfolio, a long-term investment time horizon and economies of scale.

"Our promise to our participants and annuitants is simply this:  We will always stay true to our mission and always strive to enhance our investment capabilities supporting TIAA Traditional, including our premier global asset manager Nuveen, so that the people we serve can enjoy the financial security and confidence of guaranteed lifetime income no matter how long their retirement lasts," said Duckett.

About TIAA

TIAA is a leading provider of secure retirements and outcome-focused investment solutions to millions of people and thousands of institutions. It is the No. 1 not-for-profit retirement market provider,^vi paid more than $3.6 billion to retired clients in 2020 and has $1.3 trillion in assets under management (as of 9/30/2021).^vii

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¹ TIAA Traditional, a fixed annuity issued by Teachers Insurance and Annuity Association of America (TIAA), New York, NY.

Annuity contracts contain terms for keeping them in force. Exclusions, restrictions, limitations and reductions in benefits will, in certain situations, apply to annuity contracts. Your financial consultant or advisor can provide you with costs and complete details.

TIAA Traditional is issued through these contracts: Form series 1000.24; G-1000.4 or G-1000.5/G1000.6 or G1000.7; 1200.8; G1250.1; IGRS-01-84-ACC and IGRS-02-ACC; IGRS-CERT2-84-ACC and IGRS-CERT3-ACC; IGRSP-01-84-ACC and IGRSP-02-ACC; IGRSP-CERT2-84-ACC and IGRSP-CERT3-ACC; 6008.8 and 6008.9-ACC; 1000.24-ATRA; 1280.2, 1280.4, or 1280.3 or 1280.5, or G1350.

This material is for informational or educational purposes only and does not constitute fiduciary investment advice under ERISA, a securities recommendation under all securities laws, or an insurance product recommendation under state insurance laws or regulations. This material does not take into account any specific objectives or circumstances of any particular investor, or suggest any specific course of action. Investment decisions should be made based on the investor's own objectives and circumstances.

Investment, insurance and annuity products are not FDIC insured, are not bank guaranteed, are not deposits, are not insured by any federal government agency, are not a condition to any banking service or activity, and may lose value.

©2021 Teachers Insurance and Annuity Association of America-College Retirement Equities Fund, 730 Third Avenue, New York, NY 10017

ⁱ Any guarantees under annuities issued by TIAA are subject to TIAA's claims-paying ability. TIAA Traditional is a guaranteed insurance contract and not an investment for federal securities law purposes.

ⁱⁱ "Paycheck" is the annuity income received in retirement.  Guarantees of fixed monthly payments are only associated with TIAA's fixed annuities.

ⁱⁱⁱ Interest credited to TIAA Traditional Annuity accumulations includes a guaranteed rate, plus additional amounts as may be established on a year-by-year basis by the TIAA Board of Trustees. The additional amounts, when declared, remain in effect through the "declaration year", which begins each March 1 for accumulating annuities and January 1 for payout annuities. Additional amounts are not guaranteed for periods other than the period for which they are declared.

TIAA may provide a loyalty bonus based upon the length of time the funds are held in TIAA Traditional.  The loyalty bonus is a return of unused contingency reserves and is only available upon annuitization.  The board determines this amount on an annual basis.  Past performance is not a guarantee of future performance.

^iv Source: TIAA Annuity Center of Excellence, based on a study that compared the amount of initial lifetime income that would have been received by two hypothetical participants beginning lifetime income, for each of the 334 months from January 1, 1994, through October 1, 2021. The two hypothetical participants are the same age (age 67) and they select a single-life annuity with a 10-year guarantee period using TIAA's standard payout annuity. The career contributor made level monthly contributions to TIAA Traditional under the Retirement Annuity Contract over a 30-year career prior to their retirement date. The new contributor transferred the same final accumulation as the career contributor to TIAA Traditional shortly before selecting lifetime income. Over the study period, the career contributor's initial lifetime income exceeded that of the new contributor in 324 of the 334 retirement months, with an average lifetime income advantage of 14.5 percent. Their biggest advantage was 29.8 percent and their smallest advantage was -2.9 percent (i.e., a disadvantage). Over the study's most recent decade, the career contributor's initial lifetime income exceeded that of the new contributor in all 120 retirement months, with an average lifetime income advantage of 22.4 percent. Their biggest advantage was 29.8 percent and their smallest advantage was 12.8 percent. In the study's most recent month, the career contributor's initial lifetime income exceeded that of the new contributor by 17.6 percent.

^v TIAA may share profits with TIAA Traditional retirement annuity owners through declared additional amounts of interest and through increases in annuity income throughout retirement.  These additional amounts are not guaranteed other than for the period for which they were declared.

^vi As of Dec. 31, 2020. Based on data in PLANSPONSOR's 403(b) Market Survey, which published in August 2021.

^vii As of September 30, 2021 assets under management across Nuveen Investments affiliates and TIAA investment management teams are $1,331 trillion.