Greetings! Greg Shepard here, your guide to unlocking the mysteries
of higher ed retirement plans, representing S&A Financial Services. Today,
I'm here to share a crucial piece of knowledge, especially for those
approaching retirement. It's about the freedom to make choices, and not simply
following assumptions. Let's jump right into it.
The Power of Choice
In our recent experiences, we've encountered a surprising trend
among soon-to-be retirees in the higher education sector. A significant number
of them, and maybe you're among them, have a shared assumption – that they must
leave their retirement savings with their current vendor, often in this case,
TIAA. But let me clarify something very important: you don't have to make this
choice simply based on habit or expectation. In fact, there's a world of
possibilities waiting for you.
The truth is, when you separate from your employer and embark on
retirement, your retirement savings don't have to remain locked with your
current vendor. The key here is understanding that your hard-earned money is
your money, and you have the freedom to explore alternative options that may better
align with your retirement goals.
This principle doesn't only apply to TIAA; it extends to every
retirement plan vendor you might have in higher education. The key takeaway:
don't make any assumptions, and don't stick with a vendor simply because it's
what you're used to. Your retirement plan should be a tailored fit for your
What Do We Mean by Choice?
Before we delve deeper into why you should consider exercising
this power of choice, let's understand what we're talking about.
When you retire, it's natural to think about your financial future
and how to manage your retirement accounts. The common approach is to leave
your retirement savings with your current vendor, like TIAA, believing it's the
easiest option. It's like staying in a comfortable but somewhat rigid
relationship out of habit, even if you've evolved.
However, there's a world of opportunities beyond your current
vendor. It's akin to navigating the dating scene again, and the idea isn't to
break up with TIAA or any other vendor. Instead, consider it as an opportunity –
diversifying your investment relationships to achieve a more dynamic and
tailored approach to your retirement.
Unlocking the Potential
Imagine the possibilities that open up when you embrace the
freedom to diversify your retirement accounts. This isn't about severing
connections with your current vendor; it's about taking the wheel and making
the best choices for your future. Here are a few reasons why this is advantageous:
Investment Options: Different vendors
offer various investment options. By exploring alternative vendors, you can
access a broader range of investments, which might be more aligned with your
Management: By spreading your
investments across different vendors, you can mitigate risks. Diversifying your
holdings is a well-known strategy for managing risk, and your retirement
savings are no exception.
Control: Having your retirement
savings diversified across vendors offers you more flexibility in how you
structure your retirement income.
Withdrawals: Different vendors have
different withdrawal rules. By having multiple vendors, you can strategically
decide where to withdraw from based on your financial needs, potentially
optimizing tax advantages.
Efficiency and Personalization
In my experience, the most efficient retirement game plan often
involves a combination of different vendors. One key player for many of my
clients is Charles Schwab, where we custody our assets. Alongside Schwab, we
leverage the strengths of what TIAA does best, creating a dynamic and
personalized retirement strategy.
By integrating these different players, we can craft a retirement
approach that's truly tailored to your unique needs and goals. No one's
financial situation is identical, so your retirement plan should be a
reflection of your individuality. This approach can offer not only greater
efficiency but also the ability to adapt your strategy as your retirement
Remember, the goal isn't to abandon your long-standing
relationships with vendors like TIAA. Instead, the aim is to embrace the
benefits of diverse partnerships, allowing you to tap into various strengths
Navigating the Transition
Let's clarify how this process might work when transitioning to
retirement. As mentioned earlier, retirement doesn't mean a final departure
from your current vendor, but rather a reconfiguration of your financial relationships.
Diversification: You can explore a diversified approach, moving your retirement
savings across multiple vendors. While one vendor might excel in certain areas,
others could offer unique benefits that align with your financial goals.
Tailored Withdrawals: When it's time to start drawing from your retirement accounts,
you can strategically choose from which vendor to withdraw. This isn't just
about maximizing returns but optimizing your tax liabilities and preserving
Competition among different vendors can drive down management fees, benefiting
your overall portfolio. Paying fewer fees means more money in your pocket, and
during retirement, every dollar counts.
Access to Better Investment Options: Various vendors offer different investment options.
Exploring alternatives allows you to access a broader and potentially more
profitable array of investments.
Diversifying your retirement savings across multiple vendors can help spread
risk. If one vendor underperforms, the others can compensate.
Conclusion: The Future Is Yours
In conclusion, my message to you in higher education, is one of
empowerment. As you approach retirement, don't be guided by assumptions. You
have the power to shape your financial future.
You don't have to leave your retirement savings with your current
vendor, no matter how long you've been with them. Explore the diverse world of
possibilities awaiting you. Imagine the potential for expanded investments,
efficient strategies, cost savings, and the freedom to align your retirement
plan with your unique goals.
This isn't about severing relationships; it's about designing a
financial future that meets your specific needs. The future is yours to craft.
So, take charge of your retirement plan and make the choices that will pave the
way for a more secure and fulfilling retirement.
If you have questions, thoughts, or need guidance, remember that
I'm just a message away. Your financial future is worth every bit of attention,
and I'm here to assist you every step of the way.
So, seize this moment, embrace the power of choice, and embark on
your retirement journey with confidence and purpose. Your financial future has
never been brighter.
Contact Information: If you have questions or need assistance with your retirement plan choices, you can reach out to Greg Shepard at firstname.lastname@example.org
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*Nothing discussed in this blog post should be construed as investment advice. Each situation is unique and you need to receive professional advice from independent fee-only financial advisor that's familiar with higher ed retirement plans prior to implementing any strategies discussed or thought of on your own.
**S&A Financial Services, Inc. is a registered investment advisor. Content presented is for informational purposes only and should not be considered as investment advice or as an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Always consult with your tax advisor or attorney regarding your specific situation.