Ask the grumpies: IRA with Vanguard or TIAA-CREF?

Steph asks:

I’ve managed to swing one month of actual wages this year (my salary is usually all a stipend/fellowship), which means I can put some money in an IRA! I have an existing IRA with Vanguard, but the 1 month job will also let me put money directly into an IRA at TIAA Cref. I won’t quite make enough to hit the yearly max, even pre-tax, and there’s no matching. I’m leaning Vanguard – do you have any suggestions?

Disclaimer:  We are not professional anything except academics– do your own research and/or consult actual professionals before making important monetary decisions.

You are correct to prefer Vanguard.

Vanguard has better fees for IRAs than does TIAA-Cref.  Vanguard is pretty nice to work with.  You already have an existing IRA with Vanguard, so you’ve already done the hard part of getting it set up.

The nice thing about TIAA-Cref is that they will send a person to hold your hand if you need help with something.  But this is just a basic IRA and you’ve already got one.  The TIAA-Cref option is better for people who just aren’t going to get an IRA unless they get help from someone in person.  Which isn’t you.

Finally, depending on how much money you have invested and how you have it invested (we presume low cost broad-based index funds), Vanguard has even lower fees for its admiral funds.  If putting more money in allows you to hit the threshold, then you’ll be paying an even smaller percentage in fees than you were before.

So… I don’t see any downside for keeping with Vanguard or any upside for putting an IRA into TIAA-Cref.


9 Responses to “Ask the grumpies: IRA with Vanguard or TIAA-CREF?”

  1. Steph Says:

    Thanks! Most of my existing Vanguard money is in a target date retirement fund – I’m a set-it-and-forget-it investor for the most part, so I like that they rebalance and I don’t have to think about it, even if the fee isn’t as low as an index fund. Unfortunately it doesn’t look like they offer Admiral shares in those funds, but it’s a good thing to consider for the future

    • nicoleandmaggie Says:

      Vanguard’s target-date fund is great. If that’s what is working for you, keep using it! (And last I checked, Vanguard’s target-date funds were still better than TIAA-Cref’s in terms of fees, though it has been a few years since I looked.)

  2. nicoleandmaggie Says:

    From email:
    Dear Indivisibles,

    This is a full-fledged attack on our democracy.

    Just moments ago, Trump declared a national emergency to build his vanity wall after signing the funding bill (that passed both the Senate and the House last night) which will lead to even more detention, deportation, and family separations at the border.

    Make no mistake — this is an illegal, anti-democratic power grab rooted in racism. The only emergency at the border is the one created by Trump and the Republicans enabling his temper tantrum. Congress and the people have already rejected Trump’s wall. Going around constitutional separations of power and declaring a fake emergency as a desperate attempt to get his way is an abuse of his executive power.

    We will not let Trump get away with this. Trump is setting up a dangerous precedent to justify almost limitless future abuses of presidential power. Abuses that can result in far-reaching harm to us all, especially communities disproportionately at risk.
    Take your energy to the streets

    On Monday, February 18, we’re joining MoveOn, Win Without War, and CREDO in a mass mobilization to call on Congress to act on Trump’s fake national emergency. We’ve got to let every single member of Congress know that they need to fight back. Here’s how: Sign up to take action this Monday. Join us, MoveOn, Win Without War, CREDO, and more at an event near you to call on Congress to put an end to Trump’s fake national emergency. You can also text “MOBILIZE” to 977-79 to get updates and the national event map when it’s live! Call your MoCs and tell them to reject Trump’s fake emergency. Congress has an obligation to check Executive Branch abuses, and there is a clear path for them to do this. They need to act to protect our democracy by passing a resolution to terminate this phony emergency and protect the people (the majority of which reject Trump’s vanity wall). Read more on how you can demand Congress launch investigations into this abuse of power. With their new oversight powers in the House, Democrats should immediately schedule hearings and investigations into Trump’s illegal power grab.

    This is the move of an authoritarian, reckless human filled with hate and a stubborn need to fulfill his campaign promise. Trump will not get away with it and our MoCs must uphold the mandate that they accepted the day they were elected into office to fight back and protect our democracy.

    Together we’re stronger than Trump’s racist, hateful agenda. We’ve got this. Stay tuned and get ready to take to the streets.

    In solidarity,
    Indivisible Team

  3. nicoleandmaggie Says:

    What I want (among other things!) is for states to sue to stop the wall.

    Love and basic human decency,

  4. rose Says:

    Thank you for this post addendum.

  5. Sb Says:

    A former employer transferred my retirement account with them from vanguard to Tiaa Cref without my consent. Why did they do that? Why is that allowed? What are the ramifications to me?

    • nicoleandmaggie Says:

      We don’t know the answers to those questions. Do they still have vanguard as a provider? Vanguard is pretty pricey from an employer perspective. Tiaa-cref spreads out costs more across employer and employees.

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