TIAA-CREF
Encyclopedia : T : TI : TIA : TIAA-CREF
TIAA-CREF is one of the largest financial services companies in the United States, with some $360 billion in assets under management as of Sept. 30, 2005. Its approximately 15,000 institutional clients are drawn from the non-profit and educational sectors, and the company itself is operated on a not-for-profit basis. It is based in New York City and has major offices in Denver, Colorado and Charlotte, North Carolina and satellites around the US. Since 2002 its Chairman, President, and Chief Executive Officer has been Herbert M. Allison, Jr., formerly President and Chief Operating Officer of Merrill Lynch.
TIAA-CREF was originally created to provide retirement income for professors, and its core business remains retirement plan administration and annuity products. It is by far the largest manager of so-called employer-sponsored 403(b) tax-sheltered annuity plans, a defined contribution retirement plan for employees of 501(c)(3) educational, religious, and charitable organizations. The company also offers 401(k) and 457 plans, Keogh plans, and Supplemental Retirement Plans. Contributions from these plans are typically invested in the company's traditional or variable annuities or its line of mutual funds.
At the retail level, TIAA-CREF offers Traditional and Rollover Individual Retirement Accounts, Roth IRAs, mutual funds, after-tax annuities and life insurance (through TIAA-CREF Life), 529 college savings plans, Coverdell Education Savings Accounts, financial planning, and trust and investment management (through TIAA-CREF Trust Company, FSB).
History
Andrew Carnegie is credited with foreseeing the need to offer pensions for professors. In 1918 his Carnegie Foundation for the Advancement of Teaching, under the leadership of Henry S. Pritchett, created the Teachers Insurance and Annuity Association of America (TIAA). It was incorporated as a life insurance company and tasked with providing life insurance and pensions for college and university employees, and endowed with $1 million from the Carnegie Corporation of New York.Conservative investing allowed TIAA to survive the 1929 stock market crash and the Great Depression. Faced with high inflation, increasing life expectancies, and a dramatic expansion of the education sector with the G. I. Bill of Rights, TIAA established the College Retirement Equities Fund (CREF), a variable annuity allowing for investment in equities, in 1952.
Beginning in November 2005 [link], and still a problem in late January 2006 [link], problems with an upgrade to TIAA-CREF's computer systems have made it difficult for some pensioners to access their funds and potentially exposed them to increased taxes, fees and penalties. The CEO of TIAA-CREF has commented on these problems [link].
On June 22, 2006, TIAA-CREF announced that it had agreed to acquire Kaspick & Company, "the nation's leading provider of planned giving services for colleges, universities and other non-profits," in a cash deal. The deal is expected to close by late September 2006.http://www.tiaa-cref.org/newsroom/news_articles/newsarticle180.html
References
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