Record Keeping Services is going to be outsourced. Is there any truth to this?
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I don't think they can price their recordkeeping competitively without losing money. When they went to tiered pricing (R1, R2 and R3) it wasn't because there was such a discrepancy to their cost in large plans versus small plans. That's what they claimed, but it was B.S. like most of TIAA managements spin jobs. It might have been a LITTLE more expensive to recordkeep fo small schools than large ones, but the REAL reason for the tiered pricing is that if they wanted to keep some of the major name schools and not have headlines about them losing major institutions, they needed to price some of the BIG schools recordkeeping at a level that LOST money for them. I know of a major state school that was priced at 19 bps and that was TIAA's cost. They were in an RFP situation with Fidelity and others and had to price it below their cost in order to keep them. So all the little private schools in the state got their fees jacked up by 30%-40%. Never trust the spin TIAA gives us. They ALWAYs have a hidden agenda. For example, offering severance to 75% of the employees had a reason. They needed to quietly dismantle the old wealth management structure in anticipation of slowing revenue and the $97 million settlement. The percentage of people taking the severance in that area was FAR bigger than 10.... but TIAA was able to hide the intentional dismantling of the RIA sales force without it being a story. They always give a reason for their big moves and that reason is always a smoke screen to hide their real intent.
As they outsource more and more of their functions, it dilutes their claims of being “different”. Their sanctimonious claim of operating with different “values” doesn’t apply to contract workers and outsourcing firms.
There are a lot of changes going on. At this point all we can do is sit and wait....or move on!
what is going on with this company? feels painful every day.