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TIAA Cons and Pros for 2024
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TIAA Cons and Pros Overview
TIAA, also known as TIAA-CREF, is a Fortune 100 company established in 1918, serving professionals in non-profit sectors like academia, government, and healthcare. It is highly rated, with 72% of its mutual funds receiving 4 or 5 stars from Morningstar. But is TIAA the right choice for your investment needs? Here’s a detailed look at the pros and cons.
TIAA Pros
- Low entry point for investments, with non-transaction fee (NTF) mutual funds starting as low as $500.
- Highly interactive website, designed to assist investors at different stages of their financial journey.
- Extensive educational content suitable for beginners, including quizzes, charts, and investing tips.
- A broad mutual fund selection surpasses offerings from some competitors like Merrill Edge.
- Access to investment advisors across the U.S., a rare feature not provided by firms like Firstrade, Vanguard, and Ally Invest.
- Innovative robo-advisory service providing automated, high-tech investing options.
- Customer service available on Saturdays, unlike competitors such as Vanguard.
- Unique investment opportunities in TIAA’s own family of funds, not typically offered by brokers like E*Trade and SogoTrade.
TIAA Cons
- Primarily caters to the non-profit sector professionals, which may not appeal to all investors.
- The website content may be too basic for advanced investors.
- Absence of a desktop trading platform, which is a drawback for active stock and option traders, unlike what’s available from Charles Schwab with no prerequisites.
- No simple browser-based trading platform, which is commonly offered by brokers like TradeStation and TD Ameritrade.
- Higher mutual fund transaction costs compared to brokers like Firstrade, which charges no fees.
- Smaller mutual fund selection compared to other major brokers like TD Ameritrade and WellsTrade.
- Higher fees for traditionally-managed accounts compared to Charles Schwab, which offers free services.
- Lacks 24/7 customer support, unlike firms like WellsTrade and Merrill Edge.
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TIAA Overview
TIAA has recently reduced its commissions, making it more competitively priced in the market. Equity trades are now free.
However, mutual fund transactions are costly at $50 each, compared to Firstrade’s $0 fee, and E*Trade's $19.99 rate.
At TIAA, bonds and CDs must be purchased through client service, not available online, which is a limitation compared to other firms that offer these investments online at better rates.
TIAA’s Portfolio Advisor Program caters to clients with assets over $50,000, offering a hands-off investment approach tailored to the investor's goals and values.
TIAA doesn’t focus on active trading; it lacks a robust trading platform or advanced charting and encourages long-term investing with infrequent rebalancing. This approach suits many but offers less flexibility for those desiring active investment management.
Updated on 7/5/2024.
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