Life Events - Retiring from the University of Michigan:
tiaa-cref income options
A lifetime annuity is the only income option that is guaranteed to last as long as you live. You can start a TIAA-CREF one-life or two-life annuity at any age once you have retired. A lifetime annuity may be appropriate if you want a regular income to replace your salary once you have retired. It is also an irreversible arrangement. Once you begin receiving payments, you can’t stop them. Furthermore, once you start receiving income under a two-life annuity, you can’t change your annuity partner.
With a one-life annuity, you receive an income for as long as you live. At your death, payments can continue to a designated beneficiary if you include a guaranteed period.
This option pays lifetime income to you and an annuity partner (spouse or any other person you name) for as long as either of you live. At the death of both you and your annuity partner, payments can continue to your designated beneficiary(ies) if you include a guaranteed period.
With a guaranteed period, if you die (under the one-life option) or both you and your annuity partner die (under the two-life option) during the guaranteed period, income continues to your beneficiary for the remainder of the period. If you and your partner both outlive the guaranteed period, no payments will be made to your beneficiaries when you and your annuity partner die. TIAA-CREF offers guaranteed periods of 10, 15, or 20 years.
TIAA Traditional Transfer Payout Annuity
This option allows you to withdraw funds from TIAA Traditional in the Basic Plan in annual installments over 9 years when you retire or terminate employment. Each year, you’ll receive about 10% of the total amount you chose to withdraw. For the portion of your TIAA Traditional accumulation that you don’t withdraw, you’ll continue to have the same ability to transfer among TIAA-CREF’s annuity accounts.
In addition, you can convert the value of your remaining payments to lifetime annuity income at any time. If you die while receiving income under the TIAA Traditional Transfer Payout Annuity, your beneficiary(ies) can either receive the income for the rest of the period or take the commuted (discounted) value of the remaining payments in a lump sum.
The TIAA Traditional Transfer Payout Annuity is subject to mandatory 20% federal tax withholding and may be rolled over. In general, the IRS early withdrawal penalty will also apply to payments you receive if you are under age 59½.
TIAA Traditional Interest Payment Retirement Option (IPRO)
This option provides monthly payments drawn only from the current interest credited to your TIAA Traditional accumulation in the Basic Plan. Since only the interest is paid to you, your accumulation remains untouched.
This option is available to those who are age 55 to 69½ and terminated, retired, or on phased retirement. After 69½, you can choose it only if you are on phased retirement and plan to continue working for at least another year. In general, you must convert from the interest-only option to a lifetime annuity or to the Minimum Distribution Option by April 1 following the year you turn 70½ — if you are no longer working — or following the year you retire or terminate, whichever is later.
The University of Michigan in its sole discretion may modify, amend, or terminate the benefits provided with respect to any individual receiving benefits, including active employees, retirees, and their dependents. Although the university has elected to provide these benefits this year, no individual has a vested right to any of the benefits provided. Nothing in these materials gives any individual the right to continued benefits beyond the time the university modifies, amends, or terminates the benefit. Anyone seeking or accepting any of the benefits provided will be deemed to have accepted the terms of the benefits programs and the university's right to modify, amend or terminate them.