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Tiaa-cref Now Offers Dfa Funds

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My company is looking to switch our 403b plan to TIAA-CREF. The rep told me that they now offer DFA funds as part of there 403b plan package. I've read that DFA funds are very good and the general public can only buy them through select financial planners. Does anyone have experience with DFA funds? I was wondering if we should include these in our plan. Thanks for the input.

 

Garry

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Guest Guest_Joel L. Frank

Based on an institution's request/needs the DFA funds will be offered on an employer specific basis. It marks Tiaa-Cref's entrance into the 403(b)7 market place.

 

Peace,

Joel

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I am one of those select financial planners and yes, the funds are good. They are low-cost, no-load funds that are designed to capture specific risk premiums in the asset classes they target. They are between active & passive management strategies. Your institution would be lucky to have access to DFA funds, though I do believe it will only be a few DFA funds, in addition you will probably have access to several other index funds that will allow you to build a well diversified portfolio. TIAA is very strong on the fixed income and real estate side but has really struggled on the equity side, the move to offer outside funds as well as their own branded index funds represents a good opportunity for both TIAA & its institutions. That is at least my opinion.

 

ScottyD

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Guest Murph

What do the select financial planners get out of the deal? Are they volunteers?

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No, they are not volunteers! DFA does not like "" money as it disrupts their trading and long term return strategies. In order to protect the integrity of the funds they only what certain people to distribute them, that would be advisors who believe in the DFA way of managing money. DFA funds while no load are rarely available without paying an asset management fee, the larger the dollar amount the lower the fee. I have seen advisors charge anywhere from .20 - to 1.50% for DFA funds. Financial Planners who use DFA funds have a bit of exclusivety that I guess they could brag about, but I don't use DFA for that reason, I use them because I believe I can give my clients a higher return with lower risk and that means more money for the clients. Not sure if that helps. The relationship with TIAA is great becauase participants in those select plans will be able to access some of the DFA funds with only the TIAA admin fee, not a bad deal!

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Guest Dan

I would love to have the option of investing my 403b money in DFA funds. Does my employer have to request it, or will I automatically have the option? Currently, I can only invest in the following CREF stock funds: Stock, Growth, Equity Index, and Global Equities.

 

If my employer needs to request it, can anyone tell me where I can get some information (in writing) that I can present to my employer?

 

When will the new policy go into effect?

 

Thanks,

 

Dan

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Guest Patrick L.

Thank you for the info. My wife and I both work for a medical college that has TIAA-CREF for it's 403(b). I like the company, the low fees. I do not like the way they "fiddle around" with the index funds with active speculation. DFA seems to be the answer. Larry Swedroe, whom I respect tremendously, recommends these funds. I just wrote TIAA-CREF to see if these are available to me, and if not, how I can get them added. Thanks a lot.

Pat

 

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Guest Dan

Well, I called TIAA-CREF regarding the availability of DFA funds. They said that DFA funds are available currently in only a few states. Eventually, they will be available in all states (within two years). As the option becomes available in each state, individual employers will be given the option of allowing their employees to have access to DFA funds. The representative that I spoke to said that there's no specific time frame, but they will try to make DFA funds available in all states as quickly as possible.

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Guest Thank you

I appreciate the info. I am still waiting for a reply from them. I will let you know if they tell me something different.

Pat

 

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Guest They are here

I called TIAA-CREF and was told that the employer must request the funds, as you had said. Just for fun, I e-mailed my college's benefits manager about this. She said that she is currently talking with her TIAA rep to draw up a presentation for the college board. She says she will do everything she can to make it work. She thinks it will go through! Hooray for that. I will repost if and when it happens to let you know what we have available, etc.

Pat

 

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That's great news Pat. FYI - TIAA-CREF offers 4 DFA funds. They are: US Small-Cap Value, US Micro Cap, Emerging Markets and Int'l Small Co. They also offer 2 Vanguard funds, Explorer and Asset Allocation. Maybe you can get these added too. Good luck!

 

Garry

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Guest Pat

Thanks Garry. I did not know which of the many are offered. I was hoping for more DFA including large international, large value, and international value. I am not a fan of VG asset allocation. I have life strategy growth, and wish it wasn't in there. Nonetheless, I think these additions would be great for adding asset classes to the total market index and bond funds. Without DFA and VG, their international and small company offerings are poor. I appreciate the response.

Pat

 

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