The Unique Retirement Vehicle for Professors
Understanding TIAA Traditional Annuities
by Chris Brown, Ph.D., MBA, CFP® and Ron A. Rhoades, JD, CFP®
Are you one of the 5 million workers in America invested in a TIAA Traditional Annuity? (TIAA, 2025a)
For many academics and nonprofit professionals – particularly those approaching retirement – TIAA Traditional often constitutes the largest single holding in their retirement portfolio. Yet despite its century-long presence in the retirement landscape, the TIAA Traditional Annuity remains one of the most misunderstood financial products available. It is not a bond fund, nor is it a standard money market account. Rather, it is a guaranteed insurance contract backed by TIAA’s General Account, and it operates unlike almost any other asset class. (TIAA, 2025b)
Why TIAA Traditional is Unique
In our latest downloadable PDF guide, “Understanding and Managing TIAA Traditional Annuity Liquidity Constraints”, we take an in-depth, research-backed look at this unique investment vehicle.
- What makes TIAA Traditional unique? Learn how its strength derives from a diversified portfolio with a long-term investment approach.
- What are the different contract types, and how does this effect your payout?
- How are funds paid out to participants, and what approach should you consider to maximize withdrawals for retirement?
- How does TIAA Traditional fit within an evidence-based investment portfolio, and why is it an exception to the general anti-annuity sentiment?
Overall, you’ll discover how this unique financial instrument combines insurance guarantees with competitive investment returns. By understanding the specific rules governing your contract types and planning proactively, you can harness the security that TIAA Traditional offers while maintaining the flexibility needed for a successful retirement. The key is education, planning, and a clear-eyed assessment of your individual needs for guaranteed income versus portfolio liquidity.
About the Authors
Ron A. Rhoades, JD, CFP®
Ron Rhoades is an Associate Professor of Finance at the Gordon Ford College of Business, Western Kentucky University. He also serves as a financial advisor at Scholar Financial, a practice within XY Investment Solutions LLC. With a background as both an attorney and a CERTIFIED FINANCIAL PLANNER™ professional, Ron is a nationally recognized authority on the fiduciary duties of financial advisors.
Chris Brown, Ph.D., CFP®
Chris Brown is a faculty member in the Department of Finance at the Gordon Ford College of Business, Western Kentucky University, and a financial advisor at Scholar Financial, a practice within XY Investment Solutions, LLC. He holds the CERTIFIED FINANCIAL PLANNER™ designation and a Ph.D. in Finance. His research and teaching focus is on behavioral finance, retirement planning, and evidence-based investment strategies.
Disclaimer: This article and the downloadable guide are for educational purposes only. Scenarios and references to client experiences are used solely to illustrate financial planning concepts. Dr. Eleanor Vance is a hypothetical client and is not directly representative of any current client of Scholar Financial of XYPN Sapphire. These examples may not apply to your individual circumstances. It should not be construed as financial, legal, tax, or investment advice, nor as a recommendation to implement any specific strategy, product, or investment. As a fiduciary, we provide advice tailored to each client’s goals and financial situation. Consult with a qualified financial professional before making investment decisions.
Advisory services are offered through XYPN Sapphire and its various IAR brands under which it operates. XYPN Sapphire is an SEC registered investment adviser. For additional disclosure and privacy information, please visit XYPNSapphire.com/disclosures.
References
TIAA Institute. (2017). Tax-efficient sequencing of accounts to tap in retirement. TIAA Institute Research Dialogue.
Vanguard. (2022). A ‘BETR’ approach to Roth conversions. Vanguard Research.
