03.10.25

All Americans Gain Access to TIAA Lifetime Income Annuities

  • More than 55 million Americans don’t have access to a retirement plan at work
  • Historic expansion of TIAA’s mission gives all Americans access to pension-like guaranteed retirement checks for life 
  • Annuitizing a portion of your savings with TIAA Traditional offers between 33% and 43% more income than a 4% withdrawal strategy

New York, March 10, 2025 –TIAA is for the first time making its proprietary lifetime income annuities available to all Americans through the TIAA IRA.

For over a century, TIAA has provided guaranteed pension-like retirement checks to millions of workers in the nonprofit, academic and medical fields. In 2022, corporate 401(k) plan sponsors and other defined contribution plan types gained access to TIAA’s guaranteed lifetime income through the TIAA Secure Income AccountOpens in a new window.

Now, all Americans have access to TIAA’s lifetime income annuities regardless of where they work. In a further expansion of TIAA’s mission, new enrollees in a TIAA IRA can select among TIAA’s annuities, including TIAA Traditional and the CREF variable annuities. After choosing annuitization, TIAA will send retirees monthly checks for as long as they live.

“We know that steady and reliable income, not a certain dollar amount in the bank, matters most to people when they think about their financial security,” said David Nason, chief executive officer of TIAA Wealth Management and Advice Solutions. “TIAA believesOpens pdf having a financial plan for retirement, with holistic financial advice and access to guaranteed investment options, can help provide income in retirement and help millions of Americans retire with dignity.”

“The American retirement system is simply not working for far too many people. We are providing a simple solution to the more than 55 million Americans who do not have access to a retirement plan at worki,” said Colbert Narcisse, chief product and business development officer at TIAA. “Through the TIAA IRA, Americans have the option for pension-like retirement checks that can help provide certainty they will have money to spend for the rest of their life.”

Annuities Can Provide More Income in Retirement

Fixed annuities provide income certainty, and importantly, they can also often provide more income to retirees than a 4% withdrawal strategy. This is known as the TIAA Annuity Payout Advantage.

The metric shows that, in 2025, retirees could earn 33% more money in their first year of retirement than they would if they used the 4% rule alone. For example, a 67-year-old retiree with $1 million in savings could spend $40,000 in the first year of retirement using the 4% rule. But, if the same person used one-third of their savings to provide income from their TIAA Traditional fixed annuity and began receiving payouts on March 1, 2025 (and withdrew 4% of the remaining two-thirds), they would get $53,154 to spend in the first year of retirement—or 33% more income.

For employees who have contributed to TIAA Traditional inside their retirement plan over their working years, the payout rate can be significantly higher. We call this exclusive feature the TIAA Loyalty BonusOpens pdf.SMii

The longer someone has saved in TIAA Traditional, the larger their Loyalty Bonus, and the more income they could get when lifetime income payments begin. Future Loyalty Bonuses are not guaranteed but, historically, a plan participant who contributed for the previous 30 years received a 15% larger payout upon annuitizing.iii

This can be significant: Applying the historical average for the long-term Loyalty Bonus to the March 2025 payout rate, a 67-year-old annuitant with $1 million in savings could receive $57,127 per year compared with the $40,000 they would get by making 4% withdrawals alone.

Instead of a 33% Annuity Payout Advantage, they’re getting 43% more first-year income.

chart

ivSee table disclosures in footnotes.

How TIAA Stands Apart

TIAA has no public shareholders and seeks to give profits back to its participants through higher interest rates while saving, bigger retirement payouts through the TIAA Loyalty BonusSM, and the potential for income raises in retirement. This sets TIAA apart from other companies.v

TIAA’s flagship fixed annuity, TIAA Traditional, has helped millions of participants build and prepare a solid retirement foundation. It provides guaranteed growth in the saving years, meaning balances go up every day—even in the most volatile markets. When it’s time to retire, TIAA Traditional can turn savings into guaranteed monthly income for life.

Variable annuities, which TIAA pioneeredOpens pdf, offer long-term growth potential based on market performance and retirement checks that go up or down with the market. The variable annuities within the TIAA IRA are some of the least expensive in the industry.vi

TIAA is the only annuity provider that offers a way to test out whether annuity income is right for you. The Income Test Drivevii allows people to try out receiving lifetime income payments from a variable annuity for up to two years before making a final commitment.

About TIAA

TIAA provides secure retirements and outcome-focused investment solutions to millions of people and thousands of institutions. It paid more than $5.9 billion in lifetime income to retired clients in 2024 and has $1.4 trillion in assets under management (as of 12/31/2024).viii

TIAA wealth management solutions are offered directly online and through TIAA’s Wealth Management advisors and financial planners. TIAA wealth management advisors manage client investments through a range of proprietary and non-proprietary options including IRAs.

Press contact

Elizabeth Anderson
888-200-4062
Media@TIAA.orgOpens Email

i Wharton Pension Research Council. March 2022

ii The TIAA Loyalty Bonus percentage is the estimated additional amount of lifetime income you could receive when you begin annuity income compared to a new contributor who annuitizes an equal amount at the same time.

iii Results based on averages for retirement dates each month from 1/1/1995 to 1/1/2025, comparing “long-term contributors” vs. “new contributors” to highlight the difference in initial income. The long-term contributor represents a participant who has accumulated savings in TIAA Traditional. The new contributor represents a participant who has accumulated savings outside of TIAA Traditional. The new contributor annuitizes the same dollar amount as a long-term contributor when both participants reach retirement. The new contributor deposits their savings into TIAA Traditional the day before annuity payments begin, when both the new and long-term contributors are age 67. Both select a single life annuity with a 10-year guaranteed period. 361 individual retirement month cohorts were analyzed. The long-term contributor assumes level monthly premiums over the stated investment periods. Percentage represents the average difference in initial income over each of the time periods for a long-term contributor vs. a new contributor. Past performance is no guarantee of future results.

iv Table is hypothetical and for illustrative purposes only. Past performance is not a guarantee of future results. TIAA Annuity Payout Advantage: Calculation uses the TIAA Traditional “new money” income rate for a single life annuity with a 10-year guarantee period at age 67 using TIAA’s standard payment method beginning income on March 1, 2025 (7.9462%). Calculation assumes annuitization of 1/3 of total savings and 4% withdrawal of remaining 2/3 of total savings. Loyalty Bonus: In this table, TIAA Loyalty Bonus results are based on historical averages for retirement dates each month from Jan. 1, 1995, to Jan. 1, 2025, comparing “long-term contributors” vs. “new contributors” to highlight the difference in initial income. The long-term contributors in this table represent participants who have accumulated savings in TIAA Traditional for 30 years. Social Security: The U.S. Social Security Administration estimated the average monthly Social Security retirement benefit for January 2025 is $1,976, or $23,712 for the year.

v TIAA may share profits with TIAA Traditional Annuity owners through declared additional amounts of interest during accumulation, higher initial annuity income, and through further increases in annuity income benefits during retirement. These additional amounts are not guaranteed beyond the period for which they were declared. Lifetime income payments from TIAA Traditional may include a TIAA Loyalty BonusSM which is discretionary and determined annually.

vi Source: Morningstar Direct, 09/30/2024. 81% of CREF Variable Annuity accounts funds have expense ratios that are in the bottom quartile while 87.50% are below median of their respective Morningstar category. Our variable annuity accounts are subject to various fees and expenses, including but not limited to management, administrative, and distribution fees; our variable annuity products have an additional mortality and expense risk charge. Please see CREF prospectus for other fees or expenses.

vii There are no fees or charges to initiate or stop this feature. However, it’s important to note that your annuity’s balance will be reduced by the income payments you receive, independent of the annuity’s performance. Income Test Drive income payments are based upon the annuitization of the amount in the account, period (minimum of 10 years), and other factors chosen by the participant. If you do not stop the Income Test Drive within the 2-year test period, the remaining balance in the account you selected for the Income Text Drive Feature will be annuitized in accordance with the selections you made for the Income Test Drive. Annuitization at that point will be irrevocable.

viii As of December 31, 2024 assets under management across Nuveen Investments affiliates and TIAA investment management teams are $1,387 billion.

This material is for informational or educational purposes only and is not fiduciary investment advice, or a securities, investment strategy, or insurance product recommendation. This material does not consider an individual’s own objectives or circumstances which should be the basis of any investment decision.

TIAA Traditional and TIAA Secure Income Account (SIA) are fixed annuities issued by Teachers Insurance and Annuity Association of America (TIAA), New York, NY. CREF variable annuities are issued by College Retirement Equities Fund (CREF), New York NY. Each entity is solely responsible for its own financial condition and contractual obligation. Guarantees under annuities issued by TIAA are subject to TIAA’s claims-paying ability.

Annuity contracts may contain terms for keeping them in force. Contact the issuer for more information about costs and complete details.

Annuities are designed for retirement or other long-term goals, and offer a variety of income options, including lifetime income. Payments from variable annuity accounts are not guaranteed and will rise of fall based on investment performance.

TIAA Traditional Annuity and TIAA SIA interest and income benefits include guaranteed amounts plus additional amounts as may be declared 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 beyond the period for which they are declared.

Converting some or all of your savings to annuity income benefits (referred to as "annuitization") is a permanent decision. Once annuity income benefit payments have begun, you are unable to change to another option.

TIAA-CREF Individual & Institutional Services, LLC, Member FINRA, distributes securities products. Advisory services are provided by Advice & Planning Services, a division of TIAA-CREF Individual & Institutional Services, LLC, a registered investment adviser.

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. Consider the investment objectives, risks, charges and expenses carefully before investing. Please call 877-518-9161 or go to www.TIAA.org/prospectuses for current prospectuses that contain this and other information. Please read the prospectuses carefully before investing.

TIAA Traditional is issued through these contracts: Form series including but not limited to: 1000.24; G-1000.4; IGRS-01-84-ACC; IGRSP-01-84-ACC; 6008.8. TIAA Secure Income Account is issued through these contracts: Form series including but not limited to: TIAA-UQDIA-002-K, TIAA-STDFA-001-NUV and related state specific versions. Not all contracts are available in all states or currently issued.