By James W. Russell
Huffington Post, September 10, 2015
HOW GOOD IS TIAA-CREF?
A year ago I posed that question in a blog entry for Beacon Press, the publisher of my Social Insecurity: 401(k)s and the Retirement Crisis.Â I wrote that â€œTIAA-CREF, the retirement plan of many university professors and administrators as well as others, has escaped much of the increasing criticism of 401(k)-type plans. A number of academics with TIAA-CREF are even unaware that it is a 401(k)-type plan, thinking that the growing criticisms of 401(k)s donâ€™t apply to their situation.
â€œTIAA-CREF has enjoyed relative immunity from criticism for two reasons. It is a nonprofit company that is presumed to operate exclusively in the best interests of its participants because it does not have shareholders. And precisely because it is the plan of so many highly-educated professors, it is presumed to be good because surely they must know what they are doing.
â€œYet TIAA-CREF participants fare no better in retirement income than 401(k)-type plan participants with other financial services industry companies such asÂ ING,Â Vanguard, andÂ Valic. That in turn means that they fare much worse than employees with traditional defined benefit pension plans.â€
The blog entry struck a chord.Â It has been shared by nearly ten thousand readers so far.Â You can read it here.