Thanks, yes, I also like the fact that you can choose what to do with each payment. The thing is that if the guaranteed rate drops to 2.5% it doesn't thrill me but it does say "additional amounts" so it will be larger just not sure how large.Since we are talking about TPAs, I should add a couple of other points about our (DW's) TPA that may or may not be relevant.Hello. I am considering doing a 9 year payout plan. I am trying to find out if the interest rate for the amount being withdrawn continues to earn the same rate? My advisor says it stays the same but she has been incorrect in the past so I would be interested in confirmation. Thanks.DW and I are in the minority around here. We have TIAA IRAs and a taxable account--all brokerage accounts (i.e. assets are inside "brokerage windows"). They're mostly filled with Vanguard ETFs purchased without transaction fees and we've never had problems doing what we need to do either online, calling them up, or working with the WMA assigned to us. TIAA and a Treasury Direct account gives us plenty of investment options.
FWIW, we are rolling over all our illiquid TIAA Traditional in employer plans into IRAs using a Fixed Period Annuity (5 years) and a Transfer Payout Annuity (9 years). We'll probably rollover some more assets from our employer plans, but we don't feel in a rush to do this and will likely keep all our liquid TIAA Traditional currently earning almost 6%.
- I wasn't concentrating when I wrote last week that the TPA was payable over 9 years. DW reminded me today that it actually will pay out over 7 years (84 months). Maybe this is specific to her contract.
- According to TIAA's illustration, the monthly income actually increases each year. The monthly income for DW is 30% higher in Year 7 than it is in Year 1. As explained to us, this relates to the longer time that funds for later years remain invested. As I understand it, monthly payments for FPAs are calculated differently and do reset each year (hers decreased very slightly in March).
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- One valuable feature of both TPAs and FPAs we stumbled upon: The destination of payment can be changed. So, for example, she is currently having payments deposited in a Roth account as part of our Roth conversion plan, but this can be changed in future years if we don't wish to generate taxable income and either want to rollover the payments or spend them
Statistics: Posted by noviceinvestor1979 — Thu Jun 13, 2024 4:58 am — Replies 26 — Views 1764