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Funding Vehicles for 403(b) Plan

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Do the funding vehicles for a TIAA-CREF 403(B) plan have to be the vehicles offered by TIAA or CREF? Can a participant direct that his salary deferral be sent to XYZ Investment Firm?

Even without looking at the plan, I would think that a participant would not be locked into only TIAA-CREF funding vehicles. The only restriction would seem to be that the XYZ Investment Firm would need to invest in annuity type investments and otherwise comply with the rules under 403(B)....

Any comments????


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It depends on what you mean by a TIAA-CREF plan. TIAA-CREF is an insurance company. My understanding of a TIAA-CREF plan would be a plan of a college or nonprofit employer that the employer has decided to provide through TIAA-CREF - the plan is invested in TIAA-CREF contracts and is administered by TIAA-CREF for the employer.

Under this definition a person would most definitely not have the right to direct the employer to invest the money with someone other than TIAA-CREF.

On the other hand many employers have arrangements in which TIAA-CREF is not the only insurance company/mutual fund in which the ee can invest. Generally, however, in these arrangements the ee doesn't have unlimited choices of investment companies, but is limited to those companies selected by the employer.

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Keep in mind that 403(B) only allows for the money to be invested in annuities or mutual funds - no other types of investments are permitted.

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