Private K-12 School

This private K-12 school has been a TIAA-CREF client since 1960. In February 2013, concerned about managing its fiduciary responsibilities, the school expressed an interest in hiring a financial consultant to serve as co-fiduciary for its retirement plan. After a formal RFP search, the School selected Cannon Financial Strategists, Inc. (Cannon).

In addition to serving as the plan’s co-fiduciary, Cannon is experienced in plan design and provides participant education services. This rare competitive differentiator among plan consultants made all the difference, as the school was concerned that it and its participants did not fully understand how the products in the plan worked; in particular, the unique vintage system of the TIAA Traditional Annuity. CFO of the school said, “We wanted a consultant who could address compliance and fiduciary concerns, but also connect plan design, participant services, and TIAA-CREF’s value.”

Cannon presented to the investment committee and participants its approach to investment management: constructing a diversified portfolio of low-cost mutual funds, the unique alternative asset qualities of the TIAA Real Estate Account and Traditional Annuity, and lifetime income options. Cannon reviewed the benefits of these products and their effect on retirement outcomes in counseling sessions with the school, helping employees make better informed decisions.

The school, Cannon and TIAA-CREF collaborated to implement a new open architecture investment menu that included moving from individually owned annuity contracts to employer-controlled group contracts. In addition, sweeping changes were applied to the plan design: adding Roth contributions, after-tax contributions, in-plan Roth conversion and target retirement date funds.

A fully disclosed fee structure was important to the school and was emphasized during the employee education process. The school was willing to bear some of the service providers’ costs, which allowed for investment options that cost about 50% less than the individually owned annuity contracts. The school’s investment committee further conveyed the importance it placed on the retirement readiness of its employees.

With Cannon, TIAA-CREF conducted initial group meetings with participants to review the plan changes and the benefits of moving to the institutional contract. Cannon then conducted individual employee meetings following an overwhelming employee response after the plan changes took effect in December 2013.


This true collaboration was equally beneficial for all parties. Cannon has assumed co-fiduciary responsibilities for the school, and plan participants now more fully understand the benefits the school is providing them, have access to an open architecture best-in-class fund lineup, and know more about preparing for retirement.

Additional positive outcomes of the plan changes from the first half of 2014:

  • Plan participation rose 11%
  • Plan contributions increased 14%
  • Approximately 51% of employees moved their balances to the new plan menu lineup
  • Participants gained a better understanding of TIAA Traditional and many chose to leave those assets in place
  • Apart from the TIAA Traditional account assets, more than 53% of active employee balances were moved to the new plan menu lineup
  • More than 100 individual retirement plan counseling sessions were conducted with employees from implementation through May 2014 (approximately 60% of employees)
  • Employees are now more satisfied with the benefits program and better appreciate its value, which can help them increase their level of retirement readiness