How To Get Your Savings Out Of TIAA

First — congratulations. And second: you have the most straightforward path to moving your savings out of TIAA.

If your TIAA savings are in a standard retirement account, you can move them to fossil-free alternatives. There’s no penalty for moving the money, and a direct transfer (more on that below) keeps the entire process tax-free. You’ll want to make sure that the new account you choose qualifies for the tax advantages you get with standard retirement plans, such as 401(k)s, 403(b)s, and IRAs. These are called “qualified accounts.”

A few things worth knowing before you start:

• A direct transfer is the way to go. Ask TIAA to send the funds directly to your new account rather than to you. An indirect rollover — where TIAA cuts you a check — starts a 60-day clock and risks taxes and penalties if anything goes wrong. There’s no reason to take that risk.
• Annuities are the exception. If some or all of your savings are in a TIAA annuity — most commonly TIAA Traditional — those funds play by very different rules and can’t simply be rolled over. If you hold an annuity, see the annuity panel below before you act — it covers the transfer rules, the timing considerations, and why you’ll likely want an advisor’s help with this part.
• Check whether you hold more than one type of account. Many retirees have a mix — a rollover-eligible retirement account and an annuity, sometimes across multiple employers. You can move the eligible accounts now even if the annuity portion has to follow a slower path.

Once you know which of your accounts are eligible, moving them is mostly a matter of paperwork — see “How to make the transfer” below.

This is the most common situation — and it’s more hopeful than many people assume. The key is to understand a single distinction:

While you’re still employed, you generally can’t move money out of your employer’s TIAA plan — you can’t roll it to an outside IRA or send it directly to a fund company like Green Century. That money has to stay inside the plan. But you usually have real freedom to move money around within the plan — and that’s often enough to get most of your savings out of the worst holdings.

Here’s what that means in practice:

• The brokerage window is the most powerful tool. Many TIAA plans include a self-directed brokerage option, often called a brokerage window, that opens up a far wider range of investments than TIAA’s standard menu. If your plan offers one, you can usually move your existing balances into the window, liquidate your Nuveen or target-date holdings, and buy fossil-free funds like Sphere or those from Green Century — all without the money ever leaving your employer’s plan. Opening a brokerage window means completing an application on TIAA’s website, where you’ll meet a fair amount of discouraging legal language designed to warn you off. Don’t be deterred — once inside, the responsible options are there.
• Redirect your additional voluntary contributions. Your employer may match your monthly retirement contribution up to a certain amount, and that’s great. But lots of people make additional contributions every month—beyond the match rate. That money is yours, and you can decide to invest it in socially responsible funds instead of TIAA at any time.
• Money from previous employers isn’t locked. Any TIAA accounts you hold from former jobs play by the retiree rules, not these — you can roll those out to responsible funds of your choice entirely. (See the multiple-accounts note below.)
• At 59½, more doors may open. Some plans allow “in-service” rollovers once you reach age 59½, which can let you move money out of the plan even while still employed. Whether this is available depends on your specific plan, so ask your benefits office.

Two important caveats:

Plan rules vary, so not everything above is available everywhere. Some plans limit how much of your balance can go into the brokerage window, or treat employer-contributed money differently from your own contributions. And if any of your savings are in TIAA Traditional — the annuity — that portion follows much slower transfer rules even when you’re just reallocating within the plan (see the annuity panel below).

Many TIAA participants don’t have one account — they have several, scattered across current and former jobs, and sometimes mixed in with non-TIAA accounts like a Vanguard or Fidelity IRA from years past. If that’s you, the most important thing to understand is this: your accounts may not all follow the same rules.

The good news is that this usually works in your favor. The restrictions that lock up a current employer’s account don’t apply to accounts from former employers — those are generally yours to move freely.

To untangle your situation, sort your accounts into three buckets:

• Accounts from previous employers. These are the easy ones. Whether or not you’re still working, money in a TIAA account from a former job can typically be rolled over to a responsible fund of your choice, just like a retiree’s. This is often where people find the largest share of money they can move right now.
• Your current employer’s account (if you’re still working there). Generally, this money can’t leave the plan as long as you stay with this employer, but there are some loopholes. We have described these in detail above (under “If you’re still working and contributing through your employer.”)
• Any annuities, in any of the above. An annuity follows its own transfer rules no matter which job it came from. A TIAA Traditional balance from a job you left in 2008 is still an annuity, and still subject to the slower payout rules. See the annuity panel below.

A practical first step: make a simple list of every retirement account you hold — the institution, the employer it’s tied to, the approximate balance, and whether it’s an annuity. Once it’s on paper, it becomes obvious which accounts you can move today (former-employer, non-annuity), which can be reallocated in place (current-employer), and which need the slower annuity process. Most people are surprised to find that more of their money is movable right now than they assumed.

Annuities are the most complicated piece of the TIAA puzzle — and the one where it’s genuinely worth slowing down and getting help. If you hold one, this panel applies to you whether you’re retired, still working, or somewhere in between.

First, know what you have. “Annuity” isn’t one thing. The most common at TIAA is TIAA Traditional, but annuities come in several contract types — and the contract type, not your age or job status, determines how easily you can move the money. The main ones you’ll see on your statement are coded RA, GRA, RC, RCP, SRA, and GSRA. Each has its own rules. Before doing anything else, find out which contract type(s) you hold — it’s on your quarterly statement, and you can confirm it by calling TIAA directly.

Why annuities are different. A regular mutual fund balance can be moved in a day. An annuity is a contract, and TIAA builds in restrictions on how fast you can take the money out. Depending on your contract type, those restrictions range from mild to significant:

• The slowest case — TIAA Traditional in an RA or GRA contract. Here, the money typically can’t be moved in a lump sum at all. Instead it comes out through a Transfer Payout Annuity (TPA) — generally 10 annual installments paid over about nine years. There’s no penalty for using the TPA, but it’s slow by design.
• Faster cases — RC and RCP contracts. These newer contract types allow the balance to be moved out over a much shorter window — often a single lump sum within a set number of days after you leave your employer, sometimes subject to a small surrender charge.
• The supplemental accounts — SRA and GSRA. These are generally the most liquid and can usually be transferred or withdrawn without the TPA restriction.

The age rules that bracket your options:

• Before 59½: Withdrawing from an annuity generally triggers a 10% federal tax penalty on top of ordinary income tax. This is the floor — there’s rarely a good reason to pull annuity money before this age.
• 59½ to 73: This is the window where you have the most flexibility to move annuity money on your own terms.
• 73 and up: Required Minimum Distributions (RMDs) begin, and the IRS starts dictating minimum withdrawals. If you haven’t already started moving an annuity by this point, your options narrow.

The timing insight worth acting on early. Because the TPA on an RA or GRA contract takes roughly nine years to complete, the time to start is well before you actually need the money out. Some advisors suggest beginning the Transfer Payout Annuity as soon as it makes sense after 59½ — that way the clock is already running, and a meaningful share of your money is freed up each year rather than all of it being stuck. Waiting until you’re at RMD age to begin can leave you with far less room to maneuver.

This is the part to get help with. Of everything on this page, annuities are where a good financial advisor earns their fee. The interaction between your specific contract type, your age, the TPA schedule, RMDs, and the tax consequences is genuinely complex, and the right sequence can differ from person to person. An advisor who understands TIAA’s contracts specifically — not just annuities in general — can map out the optimal path for your situation. (See “How to choose an alternative to TIAA” above for questions to ask a prospective advisor.)

Before you do anything: request your exact contract details from TIAA in writing — contract type, current value, applicable transfer rules, and any surrender charges. You want those specifics in hand before you make a move, and they’re the first thing any advisor will ask for.

Inheriting a retirement account is one of the more complicated situations — and one of the easiest to get wrong in costly ways. The rules depend heavily on your relationship to the person who passed away and on the type of account, and they’ve changed significantly in recent years. Treat what follows as orientation, not instructions: this is a situation where talking to an advisor or tax professional before you act can save you real money.

A few things that make inherited accounts different:

• Your relationship matters most. A spouse who inherits a retirement account generally has the most flexibility — often able to treat the account as their own and roll it into their own IRA. A non-spouse beneficiary (a child, sibling, friend, or other heir) faces tighter rules and fewer options.
• The 10-year rule. Under current law, most non-spouse beneficiaries must withdraw the entire inherited account within 10 years. This has major tax implications — large withdrawals can push you into higher tax brackets — so how and when you draw the money down matters, and it’s worth planning with a professional rather than withdrawing on instinct.
• You can still move it to responsible funds — within the rules. The good news for our purposes: an inherited account generally isn’t locked to TIAA. You can typically move an inherited balance into a more values-aligned investment (subject to the inherited-account and annuity rules), so your inheritance doesn’t have to keep funding fossil fuels while you draw it down. If the inherited account is a TIAA annuity, the annuity transfer rules still apply on top of everything else — see the annuity panel above.
• Don’t rush, but don’t ignore deadlines either. Inherited accounts come with their own timing requirements, and missing a required distribution can trigger steep penalties. This is the opposite of a “set it and forget it” situation.

Because the stakes are high, and the specifics are complex, we strongly urge you to get qualified advice before you make any decisions.