TIAA to Offer Health Savings Accounts to Institutional Clients

TIAA, a leading financial services provider, today announced that it will offer a Health Savings Account (HSA) to its institutional retirement plan clients to help their participants prepare for health care expenses now and in retirement. The TIAA HSA will be administered by HealthEquity, Inc. (NASDAQ: HQY) ("HealthEquity") and will work in concert with TIAA retirement plans. The TIAA HSA will be available in the first quarter to all institutional clients that offer employees a high-deductible health plan (HDHP).

Preparing for rising health care costs is a significant financial concern for employers and individuals. TIAA research finds that more than 90 percent of plan sponsors say that rising health care costs are a significant concern for retirement security1. In addition, the majority of Americans (77 percent) TIAA surveyed said they are concerned about retirement health care costs2. This concern is supported by a report from Employee Benefit Research Institute3, which found that a 65-year-old couple today needs approximately $301,000 to cover out-of-pocket health care expenses in retirement.

“Health care expenses are increasingly connected to an individual’s ability to retire and maintain a good standard of living throughout their lives,” said Lori Dickerson Fouché, CEO of TIAA Financial Solutions. “Offering the TIAA HSA is a part of our deep commitment to finding new and better ways to help our clients address their financial needs to and through retirement.”

Through this relationship with HealthEquity, plan sponsors and their employees will have access to a compelling HSA offer that complements TIAA’s industry-leading guaranteed* lifetime income retirement solutions. This combination, delivered through a cohesive experience, helps meet end-to-end retirement needs and contributes to participants’ peace of mind.

“As individual life spans increase, so does the potential cost of medical care in retirement. As a result, it makes perfect sense that more plan sponsors are looking at ways to help their employees take advantage of savings opportunities that help them prepare for retirement health expenses,” continued Fouché. “By providing employees a one-stop-shop experience, we believe employees are more likely to take positive steps towards financial security.”

The TIAA HSA leverages TIAA’s strength as a financial services leader in the nonprofit retirement market and HealthEquity’s status as one of the nation’s top HSA providers. The TIAA HSA will include a diversified** series of TIAA-CREF and Nuveen mutual fund investments in an integrated TIAA online and mobile view for a simplified client experience. To help employees maximize their savings, the TIAA HSA will offer participants comprehensive tools and education resources including a plan comparison tool, an HSA contribution calculator, and a future balance calculator.

“We’re committed to helping plan sponsors meet the evolving financial needs of their employees. The TIAA HSA will enable plan participants to save for health care expenses with a simple, straightforward option that works in concert with their retirement savings plan,” said Timothy Lane, Senior Managing Director of TIAA Health Solutions. “A growing number of employers and employees recognize the favorable tax treatment*** of an HSA as a powerful long-term investment vehicle that can grow over time to fund health expenses in retirement.”

HSAs can help people prepare for and cover the cost of health care expenses because they provide triple tax-free savings4 for employees who participate in a HSA-qualified HDHP. Unspent balances carry over from year to year and can be invested for longer-term growth, building up savings over time similar to a retirement savings plan. For employers, more of whom are offering a HDHP to their employees,5 the combination of a HDHP and an HSA provides tax and healthcare premium savings, which can fund employer contributions to the HSA or other retirement benefits.

“Together with TIAA, we are helping Americans connect their health and wealth along their retirement savings journey,” said Ted Bloomberg, Chief Operating Officer of HealthEquity. “The TIAA HSA will allow consumers to save and spend their health care dollars more efficiently and HealthEquity is ready to serve TIAA HSA members with our24/7 education and support.”

TIAA was founded over a century ago to serve higher education institutions and has grown to become the leading provider of retirement services in the nonprofit market.

About TIAA

With an award-winning6 track record for consistent investment performance, TIAA (TIAA.org) is the leading provider of financial services in the academic, research, medical, cultural and government fields. TIAA has $1.1 trillion in assets under management (as of 12/31/20197) and offers a wide range of financial solutions, including investing, banking, advice and education, and retirement services.

About HealthEquity

HealthEquity administers Health Savings Accounts (HSAs) and other consumer-directed benefits for our more than 12 million accounts in partnership with employers, benefits advisors, and health and retirement plan providers who share our mission to connect health and wealth and value our culture of remarkable “Purple” service. For more information, visit www.healthequity.com.

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*Guarantees are based on the claims-paying ability of Teachers Insurance and Annuity Association of America

**Diversification is a technique to help reduce risk. There is no guarantee that diversification will protect against a loss of investment or income.

1 2018 TIAA Plan Sponsor Retirement Survey

2 2017 TIAA Lifetime Income Survey https://www.tiaa.org/public/pdf/lifetime_income_survey_checklist.pdf

3 https://www.ebri.org/content/savings-medicare-beneficiaries-need-for-health-expenses-in-2019

***The TIAA group of companies does not provide legal or tax advice. Please consult your legal or tax advisor.

4 HSAs offer the potential for a triple-tax advantage in that account contributions are made pre-tax, earnings are tax-free and withdrawals for qualified medical expenses are tax-free.

5 2018 College and University Benefits Study, Sibson Consulting

6 The Lipper Mixed-Assets Large Fund Award is given to the group with the lowest average decile ranking of three years’ Consistent Return for eligible funds over the three-year period ended 11/30/15 (against 39 fund families), 11/30/16 (36), 11/30/17 (35) and 11/30/18 (35). Note this award pertains to mixed-assets mutual funds within the TIAA-CREF group of mutual funds; other funds distributed by Nuveen Securities were not included. From Thomson Reuters Lipper Awards, © 2019 Thomson Reuters. All rights reserved. Used by permission and protected by the Copyright Laws of the United States. The printing, copying, redistribution, or retransmission of this Content without express written permission is prohibited. Certain funds have fee waivers in effect. Without such waivers ratings could be lower. Past performance does not guarantee future results. For current performance, rankings and prospectuses, please visit the Research and Performance section on TIAA.org. The investment advisory services, strategies and expertise of TIAA Investments, a division of Nuveen, are provided by Teachers Advisors, LLC and TIAA-CREF Investment Management, LLC. TIAA-CREF Individual & Institutional Services, LLC, Teachers Personal Investors Services, Inc., and Nuveen Securities, LLC, Members FINRA and SIPC, distribute securities products.

7 Based on $1.1 trillion of assets under management across Nuveen Investments affiliates and TIAA investment management teams as of 12/31/19.

TIAA-CREF Individual & Institutional Services, LLC, FINRA Member, distributes securities products. Annuity contracts and certificates are issued by Teachers Insurance and Annuity Association of America (TIAA) and College Retirement Equities Fund (CREF), New York, NY. Each is solely responsible for its own financial condition and contractual obligations.

This material is for informational or educational purposes only and does not constitute investment advice under ERISA. This material does not take into account any specific objectives or circumstances of any particular investor, or suggest any specific course of action. Investment decisions should be made based on the investor’s own objectives and circumstances.

Investment, insurance, and annuity products are not FDIC insured, are not bank guaranteed, are not deposits, are not insured by any federal government agency, are not a condition to any banking service or activity, and may lose value.

©2020 Teachers Insurance and Annuity Association of America - College Retirement Equities Fund, New York, NY 10017.

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