Haris Ashley
TIAA Bank offers a range of financial products, including money market accounts. Money market accounts are a type of savings account that typically offers higher interest rates than traditional savings accounts. While TIAA Bank's money market accounts may be FDIC-insured, it's important to note that TIAA has a conflict of interest when cash is swept into a bank deposit account. Additionally, investment, insurance, and annuity products offered by TIAA are not FDIC-insured, highlighting the importance of understanding the specific terms and conditions associated with different financial products. FDIC insurance provides protection against the loss of deposit amounts if the bank fails, giving customers peace of mind and security.
| Characteristics | Values |
|---|---|
| Protection | Securities Investor Protection Corporation (SIPC) protection, FDIC insurance |
| Protection Limit | Up to $250,000 per depositor for each account ownership category |
| ATM Fees | No ATM fees; reimbursements for fees charged by other banks |
| Minimum Balance | $5,000 for unlimited ATM fee reimbursements; lower balances receive up to $15 per month in reimbursements |
| APY | Above-average APY for new account holders with balances up to $250,000 |
| Checks and Cards | Provides checks, debit cards, and online bill pay |
| Digital Access | Mobile deposits, online and wire transfers, direct deposits |
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What You'll Learn
TIAA deposits are FDIC-insured
TIAA Sweep Product cash is held in deposit accounts at the Bank, and LIDS Overflow cash is held in deposit accounts at one or more banks. These deposit accounts pay interest on deposits according to the terms and conditions outlined in the disclosure document for the applicable bank deposit option. While interest rates may fluctuate and vary among banks, FDIC insurance provides security for depositors in the event of bank failure.
It is important to note that investment, insurance, and annuity products offered by TIAA are not FDIC-insured. These products include money market funds, which are registered securities with the U.S. Securities and Exchange Commission (SEC). Money market funds pay fees to TIAA Brokerage for distribution, administrative, and marketing services, and these fees are disclosed in the fund's prospectus.
While TIAA does have a conflict of interest when cash is swept into a bank deposit account offered through EverBank, as they earn more compensation compared to LIDS or money market funds, TIAA deposits are still FDIC-insured up to the applicable limits. EverBank, N.A. is an FDIC-insured national banking association, providing an extra layer of security for depositors.
In summary, TIAA deposits are FDIC-insured, offering protection for depositors' funds in the event of bank failure. This insurance coverage is applicable to deposit accounts, providing peace of mind for individuals and businesses who choose to bank with TIAA.
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TIAA Sweep Product cash is held in deposit accounts
TIAA Sweep deposits at the capitalize bank are insured by the FDIC up to $250,000 for each category of legal ownership, including individual retirement accounts and certain other self-directed retirement accounts, and up to $500,000 for joint accounts. FDIC insurance protects against the loss of deposit amounts in the event that the bank holding the deposits fails.
The TIAA Sweep Product will be used as the primary bank sweep option for uninvested cash balances up to a maximum amount set by the Bank (not to exceed the current per-individual depositor Federal Deposit Insurance Corporation ("FDIC") insurance limits). The Liquid Insured Deposits Program ("LIDs Overflow") will be used as an overflow for uninvested cash balances in excess of the maximum accepted by the Bank.
Deposit accounts pay interest on deposits pursuant to the terms and conditions in the disclosure document for the applicable bank deposit option. Interest rates may fluctuate and may vary among banks.
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TIAA money market funds are not FDIC-insured
TIAA money market funds are registered with the U.S. Securities and Exchange Commission (SEC) under the Investment Company Act of 1940 and the Securities Act of 1933. These funds pay certain fees to TIAA Brokerage, through TIAA-CREF Individual & Institutional Services, for distribution, administrative, and/or marketing services. These fees are disclosed in the relevant money market fund's prospectus.
It is important to note that investment, insurance, and annuity products are not FDIC insured, are not bank guaranteed, are not bank deposits, are not insured by any federal government agency, are not a condition to any banking service or activity, and may lose value.
While TIAA money market funds are not FDIC-insured, specific information about a particular bank deposit option, including FDIC insurance and other important details, can be found in the applicable bank deposit disclosure document. This document will outline the terms and conditions of the FDIC insurance coverage for the bank deposit accounts associated with TIAA.
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TIAA has a conflict of interest with EverBank
TIAA Bank, now known as EverBank, has a conflict of interest with EverBank. This is because TIAA owns a minority interest in EverBank, and EverBank earns income on investments made with cash deposits it accepts through the TIAA Sweep Product. TIAA and EverBank benefit from agreeing to use EverBank for the TIAA Sweep Product, even when other options may earn a higher yield for customers.
TIAA Sweep Product cash is held in deposit accounts at EverBank, and LIDS Overflow cash is held in deposit accounts at one or more banks. Deposit accounts are subject to FDIC insurance up to applicable limits, which protects against the loss of deposit amounts if the bank holding the deposits fails. However, deposit accounts are not subject to SIPC protection.
The Bank has discretion over setting its interest rates for deposits, which may result in a conflict of interest with customers. The Bank and participating banks in the LIDs Overflow program may seek to pay as low a rate as possible based on market and business conditions. TIAA receives asset-based revenue from Pershing on the amount of cash swept to Pershing for the LIDs Overflow program and on amounts invested in money market funds. Money market funds pay certain fees to TIAA Brokerage for distribution, administrative, and/or marketing services.
While TIAA has sold TIAA Bank to private investors, it continues to have an ongoing business relationship with EverBank. The bank sale transaction has had no impact on TIAA retirement accounts, and TIAA clients continue to benefit from the banking services they previously enjoyed through the continued relationship with EverBank.
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TIAA owns a minority interest in EverBank
On August 1, 2023, TIAA completed the sale of TIAA Bank to private investors, with the bank now operating as EverBank, N.A. under a new national bank charter. The new investors—Stone Point Capital, Warburg Pincus, Reverence Capital Partners, Sixth Street, and Bayview Asset Management—each own non-controlling interests in EverBank. However, TIAA retains a minority ownership interest in EverBank and will continue to have ongoing business relationships with the bank.
TIAA Sweep Product cash is held in deposit accounts at EverBank, N.A. ("the Bank") and other banks. Deposit accounts pay interest on deposits pursuant to the terms and conditions in the disclosure document for the applicable bank deposit option. Interest rates may fluctuate and may vary among banks.
TIAA has a conflict of interest when cash is swept into a bank deposit account offered through EverBank, as they earn more compensation than with LIDs or with money market funds. As a minority owner of EverBank, TIAA benefits by agreeing to use EverBank for the TIAA Sweep Product even when other options earn a higher yield. In setting interest rates, the Bank and participating banks in the LIDs Overflow program may seek to pay as low a rate as possible based on market and business conditions.
TIAA Sweep deposits at the capitalize bank are insured by the FDIC up to $250,000 for each category of legal ownership. FDIC insurance protects against the loss of deposit amounts in the event the bank holding the deposits fails.
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Frequently asked questions
Yes, TIAA Bank is FDIC-insured up to the standard limit of $250,000 per depositor for each account ownership category.
No, TIAA money market funds are not FDIC-insured. They are, however, registered with the U.S. Securities and Exchange Commission (SEC) under the Investment Company Act of 1940 and the Securities Act of 1933.
Yes, TIAA money market funds are SIPC-protected.
Yes, investment, insurance, and annuity products are not FDIC-insured, are not bank-guaranteed, and are not insured by any federal government agency.
Yes, TIAA Sweep Product cash is held in deposit accounts that are FDIC-insured and SIPC-protected.
