TIAA and Nuveen Lifetime Income Default Target-Date Offerings Approach $35 Billion in AUM

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May 02, 2024, 09:40 ET

Growth follows the launch of the lifetime income-embedded Nuveen Lifecycle Income funds

NEW YORK, May 2, 2024 /PRNewswire/ -- Assets in TIAA and Nuveen's suite of lifetime income target-date solutions across corporate, educational, governmental, and healthcare retirement plans are now approaching $35 billion in AUM, far surpassing assets in any other comparable lifetime income products in the market. TIAA has a broad suite of lifetime income-embedded target-date solutions to meet institutional clients' needs, including TIAA RetirePlus, the TIAA Secure Income Account (SIA) and the Nuveen Lifecycle Income CIT Series (NLI). TIAA is the leader in lifetime income whose mission it is to provide a more secure retirement to millions more Americans with the assurance of a retirement paycheckⁱ that lasts for life.

Beginning in March 2024, NLI – a target date collective investment fund solution for defined contribution plans with embedded lifetime income through SIA – was activated for 19 plan sponsors who chose to map investments from their prior default solutions. NLI was launched in August 2023 and this funding represents a robust start to the joint efforts of Nuveen and TIAA to expand access to lifetime income solutions across the defined contribution retirement market.

"Going live with these new and market-disrupting products represents a significant milestone for our organization and is the result of TIAA's strong history of leading in lifetime income," said Colbert Narcisse, chief product officer for TIAA. "As we have demonstrated with the rapidly accelerating demand for TIAA RetirePlus, TIAA is uniquely positioned to help solve America's retirement crisis. These inaugural wins for NLI, coupled with TIAA's recently announced distribution agreement with Empower, position the firm for significant growth."

"We partner with many of the nation's top retirement plan advisors and consultants who see the need for lifetime income in 401(k) plans," said Brendan McCarthy, head of Nuveen Retirement Investing. "They recognize NLI as an easy solution for employers to provide their employees with the option of a guaranteed paycheck for life through the familiar structure of a target date fund."

A 2023 TIAA Institute survey found most U.S. adults have poor longevity literacy and that the negative impact of outliving income is much larger than the negative impact of over saving.

"We're facing a very real retirement crisis in our country," said Kourtney Gibson, chief institutional client officer for TIAA. "As demand for lifetime income grows, clients are increasingly partnering with us because they want to work with a company who has TIAA's financial strength, track record of stability, mission-based ownership structure that allows us to return profits to people who hold our annuities, and because they trust our deep annuity expertise."

Since 1918, TIAA has offered guaranteed solutions that deliver tangible benefits to retirement savers and has paid out more than $585 billion in retirement benefits to millions of people. It is one of only three U.S. insurers to hold the highest possible ratings from three of four leading rating agenciesⁱⁱ.

Today, TIAA is delivering retirement security to even more Americans. Through innovative lifetime income products, smarter default solutions, and personalized advice, more people from all walks of life can access guaranteed, lifelong monthly income to help them live full and dignified retirements.

TIAA RetirePlus can be a qualified default investment alternative (QDIA) for the 403(b) and nonprofit market. It combines the ease of a familiar target-date structure with the ability to select investments from the existing plan while potentially lowering administrating costs and fees. RetirePlus allows participants to convert some or all their savings into a retirement paycheck when TIAA Traditional is built into the plan.
The TIAA Secure Income Account is a fixed annuity like the TIAA Traditional annuity but specifically designed to be used as an allocation within managed accounts or custom target-date portfolio strategies.
The TIAA Secure Income Account is also able to be embedded within the Nuveen Lifecycle Income CIT Series, a collective investment trust (CIT) target-date solution that offers participants the option of converting a portion of their holdings into guaranteed income at retirement. The trustee of the CIT is SEI Trust Company.

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 #1 not-for-profit retirement market providerⁱⁱⁱ, paid more than $5.6 billion in lifetime income to retired clients in 2022 and has $1.28 trillion in assets under management (as of 12/31/2023)^iv.

About Nuveen

Nuveen, the investment manager of TIAA, offers a comprehensive range of outcome-focused investment solutions designed to secure the long-term financial goals of institutional and individual investors. Nuveen has $1.1 trillion in assets under management as of 30 Jun 2023 and operations in 27 countries. Its investment specialists offer deep expertise across a comprehensive range of traditional and alternative investments through a wide array of vehicles and customized strategies. For more information, please visit www.nuveen.com

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Any guarantees under annuities issued by TIAA are subject to TIAA's claims-paying ability.

You should consider the investment objectives, principal strategies, principal risks, portfolio turnover rate, performance data, and fee and expense information of each underlying investment carefully before directing an investment based on the model. For a free copy of the program description and the prospectus or other offering documents for each of the underlying investments (containing this and other information), call TIAA at 877-518-9161. Please read the program description and the prospectuses or other offering documents for the underlying investments carefully before investing.

This material is for informational, educational or non-fiduciary sales opportunities and/or activities only and does not constitute investment advice (e.g., fiduciary advice under ERISA or otherwise), a securities recommendation under all securities laws, or an insurance product recommendation under state insurance laws or regulations to invest through a model or to purchase any security or advice about investing or managing retirement savings. It does not take into account any specific objectives or circumstances of any particular customer or suggest any specific course of action.

No registration under the Investment Company Act, the Securities Act or state securities laws—the model is not a mutual fund or other type of security and will not be registered with the Securities and Exchange Commission as an investment company under the Investment Company Act of 1940, as amended, and no units or shares of the model will be registered under the Securities Act of 1933, as amended, nor will they be registered with any state securities regulator. Accordingly, the model is not subject to compliance with the requirements of such acts, nor may plan participants investing in underlying investments based on the model avail themselves of the protections thereunder, except to the extent that one or more underlying investments or interests therein are registered under such acts.

No guarantee – Neither the models nor any investment made pursuant to the models are deposits of, or obligations of, or guaranteed or endorsed by TIAA or their affiliates (except with respect to certain annuities sponsored by TIAA or its affiliates), or insured by the Federal Deposit Insurance Corporation, or any other agency. There is no guarantee that the underlying investments will provide adequate income at and through retirement and participants may experience losses. Participants should not allocate their retirement savings to the underlying investments unless they can readily bear the consequences of such loss.

Assets allocated to the underlying investments based on the model will be invested in underlying mutual funds and annuities that are permissible investments under the plan. Some or all of the underlying investments included in the model may be sponsored or managed by TIAA or its affiliates and pay fees to TIAA and its affiliates. In general, the value of a model-based account will fluctuate based on the performance of the underlying investments in which the account invests. For a detailed discussion of the risks applicable to an underlying investment, please see the prospectus or disclosure document for such underlying investment.

TIAA RetirePlus Select^SM and TIAA RetirePlus Pro® are administered by Teachers Insurance and Annuity Association of America ("TIAA") as plan recordkeeper. TIAA-CREF Individual & Institutional Services, Member FINRA distributes securities products. TIAA and CREF annuity contracts and certificates are issued by Teachers Insurance and Annuity Association of America (TIAA) and College Retirement Equities Fund (CREF), New York, NY, respectively. Each is solely responsible for its own financial condition and contractual obligations. Transactions in the underlying investments invested in based on the models on behalf of the plan participants are executed through TIAA-CREF Individual & Institutional Services, LLC, member FINRA.

TIAA RetirePlus Select

TIAA RetirePlus Select is an asset allocation program that includes asset allocation models that a plan participant may choose to guide the investment of his or her account into underlying investment options selected by the plan sponsor (the "underlying investments"). The plan sponsor selects the specific underlying investments available under its plan to represent the various asset classes in the models. An independent third-party advisor engaged by Teachers Insurance and Annuity Association of America ("TIAA") developed the target asset class ratios for the models and the TIAA RetirePlus Select is administered by TIAA as plan recordkeeper. In making TIAA RetirePlus Select available to plans, TIAA is not providing investment advice to the plans or plan participants.

The target asset class ratios for a plan participant's model-based account will become more conservative over time as the plan participant's years to retirement decreases. For information regarding the changes to the target allocations please contact TIAA. An account's actual allocation percentage to an underlying investment may vary from the target allocations due to the performance of the underlying investments or other factors. Accounts invested in accordance with the models will be rebalanced to the applicable target allocations periodically. The underlying investments included in a model are subject to change and may not be representative of the current or future underlying investments for the model. Some or all of the underlying investments included in a model may be sponsored or managed by TIAA or its affiliates and pay fees to TIAA and its affiliates.

Mesirow is not affiliated with TIAA. Mesirow Financial refers to Mesirow Financial Holdings, Inc. and its divisions, subsidiaries and affiliates. The Mesirow Financial name and logo are registered service marks of Mesirow Financial Holdings, Inc. ©2019, Mesirow Financial Holdings, Inc. All rights reserved. Advisory services offered through Mesirow Financial Investment Management, Inc. an SEC registered investment advisor.

TIAA RetirePlus Pro

TIAA RetirePlus Pro, a model-based service, is administered by Teachers Insurance and Annuity Association of America ("TIAA") as plan recordkeeper.

The TIAA RetirePlus Pro Models are asset allocation recommendations developed in one of three ways, depending on your plan structure: i) by your plan sponsor, ii) by your plan sponsor in consultation with consultants and other investment advisors designated by the plan sponsor, or iii) exclusively by consultants and other investment advisors selected by your plan sponsor whereby assets are allocated to underlying mutual funds and annuities that are permissible investments under the plan. Model-based accounts will be managed on the basis of the plan participant's personal financial situation and investment objectives (for example, taking into account factors such as participant age and risk capacity as determined by a risk tolerance questionnaire).

The plan fiduciary and the plan advisor may determine that an underlying investment(s) is appropriate for a model portfolio, but not appropriate as a stand-alone investment for a participant who is not participating in TIAA RetirePlus Pro. In such case, participants who elect to unsubscribe from the service while holding an underlying investment(s) in their model-based account that has been deemed inappropriate as a stand-alone investment option by the plan fiduciary and/or plan advisor will be prohibited from allocating future contributions to that investment option(s).

Established Restrictions: Each plan participant may, but need not, propose restrictions for his or her model-based account, which will further customize such plan participant's own portfolio of underlying investments. The plan fiduciary is responsible for considering any restrictions proposed by a plan participant, and for determining (together with plan advisor(s)) whether the proposed restriction is "reasonable" in each case.

TIAA RetirePlus Select^SM is a service mark and TIAA RetirePlus® and TIAA RetirePlus Pro® are registered trademarks of Teachers Insurance and Annuity Association of America.

About Nuveen Lifecycle Income CIT Series

SEI Trust Company serves as the Trustee of the Nuveen/SEI Trust Company Investment Trust III and maintains ultimate fiduciary authority over the management of, and the investments made, in the Nuveen Lifecycle Income CIT Series (Lifecycle CIT Series).

Each fund is part of a trust operated by the trustee. The trustee is a trust company organized under the laws of the Commonwealth of Pennsylvania and wholly owned subsidiary of SEI Investments Company (SEI). The Lifecycle CIT Series is managed by the trustee, based on the investment advice of Nuveen Fund Advisors, LLC, the investment adviser to the trust, and Nuveen Asset Management, LLC as investment sub-adviser to the Lifecycle CIT Series.

The Lifecycle CIT Series are trusts for the collective investment of assets of participating tax qualified pension and profit-sharing plans and related trusts, governmental plans and other eligible plans, as more fully described in the Declaration of Trust. As a bank collective investment trust, the trust is exempt from registration as an investment company. A plan fiduciary should consider the funds' objectives, risks, and expenses before investing. This and other information can be found in the Declaration of Trust and the Funds' Disclosure Memorandum.

Annuity contracts may contain terms for keeping them in force. We can provide you with costs and complete details.

TIAA Secure Income Account is a fixed annuity product issued through this contract by Teachers Insurance and Annuity Association of America (TIAA), 730 Third Avenue, New York, NY, 10017: Form series including but not limited to: TIAA-UQDIA-002-K and related state specific versions. Not all contracts are available in all states or currently issued.

ⁱ Retirement paycheck refers to the annuity income received in retirement. Guarantees of fixed monthly payments are only associated with TIAA's fixed annuities.

ⁱⁱ For its stability, claims-paying ability and overall financial strength, Teachers Insurance and Annuity Association of America (TIAA) is a member of one of only three insurance groups in the United States to currently hold the highest rating available to U.S. insurers from three of the four leading insurance company rating agencies: A.M. Best (A++ as of 7/23), Fitch (AAA as of 8/23) and Standard & Poor's (AA+ as of 9/23), and the second highest possible rating from Moody's Investors Service (Aa1 as of 9/23). There is no guarantee that current ratings will be maintained. The financial strength ratings represent a company's ability to meet policyholders' obligations and do not apply to variable annuities or any other product or service not fully backed by TIAA's claims-paying ability. The ratings also do not apply to the safety or the performance of the variable accounts, which will fluctuate in value.

ⁱⁱⁱ As of July 21, 2022. Based on data in PLANSPONSOR's 403(b) 2022 DC Recordkeeping Survey, combined 457 and 403(b) data.

^iv As of December 31, 2023, assets under management across Nuveen's investment specialists and TIAA investment management teams are $1.28 trillion.

SOURCE TIAA