TIAA-CREF Statement on Column by Malcolm Berko
New York, December 07, 2007 --
A recent syndicated column by Malcolm Berko "Teachers Have a Lot to Learn about Investing" (Taking Stock, Nov. 23) reflects a number of misperceptions about TIAA-CREF, starting with our organization's mission: to help meet the financial needs of the institutions and individuals we serve on the best terms practicable.
To uphold that mission in the 21st century, we have expanded our range of products and services to broaden our clients' investment choices and help them make sound financial decisions. We are gratified by rapidly rising indicators of client satisfaction with TIAA-CREF's offerings and growing recognition by independent third parties.
According to Forbes, "the 3.2 million employees of colleges, hospitals and other not-for-profits whose retirement plans TIAA-CREF serves have access to the most extensive personalized workplace advice," which we deliver via consultants who receive no sales commissions as part of their compensation. i Over three-quarters of clients who have received TIAA-CREF's retirement planning and advice consider it to be superior to what is offered by other companies. ii
We also are delivering excellent overall investment performance. More than three-fourths of our mutual funds and annuity accounts beat their Morningstar averages over the past three and five years, as of September 30, 2007. Over half of TIAA-CREF's mutual funds and annuity accounts are rated either 4 or 5 stars by Morningstar, as of September 30, 2007 (nearly 90 percent received at least 3 out of 5 stars). Of our total Morningstar-rated assets, ninety percent, or $207 billion, received an overall rating of 4 or 5 stars, for the period ended October 31, 2007. The fees TIAA-CREF charges for our investment products are about half the industry average. iii
TIAA is one of just three U.S. insurance companies to receive the highest rating from all major rating agencies, meaning we have the claims paying ability our investors count on to get them through retirement. iv You can ask the 500,000 participants who currently receive a combined $10 billion in annual payments from our company. Many of these individuals have financial confidence knowing they have guaranteed retirement income they can't outlive. v
Readers of Mr. Berko's column should know that much of TIAA-CREF runs on a nonprofit basis. As competition intensifies, we believe TIAA-CREF's combination of choice, performance, value and staying power surpasses what is available from many other financial companies, none of whom share our nonprofit heritage or unique mission.
Past performance is no guarantee of future results. Please keep in mind that there are risks associated with investing in securities including loss of principal.
TIAA-CREF Individual & Institutional Services, LLC and Teachers Personal Investors Services, Inc., Members FINRA, distribute securities products. Annuity products are issued by TIAA (Teachers Insurance and Annuity Association), New York, NY. Advisory services are provided by Advice and Planning Services, a division of TIAA-CREF Individual & Institutional Services, LLC, a registered investment advisor.
You should consider the investment objectives, risks, charges and expenses carefully before investing. Please call 1 877 518-9161, or view a current prospectus that contains this and other information. Please read the prospectus carefully before investing.
i TIAA-CREF consultants are compensated through a salary plus incentive program that emphasizes client service excellence.
ii TIAA-CREF internal customer survey data, 2007.
iii Morningstar Direct (2007) based on expense comparisons by category.
iv A++ (Superior), A.M. Best Company (as of 6/07); AAA, Fitch (as of 5/07); Aaa, Moody’s Investors Service (as of 5/07); AAA, Standard & Poor’s (as of 7/07). These ratings of TIAA as an insurance company do not apply to the TIAA Real Estate Account, to CREF or to the organization’s mutual funds.
v Any guarantees under annuities issued by TIAA are subject to TIAA's claims-paying ability. Payments under CREF and the TIAA Real Estate variable annuity accounts are variable and will rise or fall based on investment performance.
