TIAA has joined the growing number of financial services firms adding a robo-advisor to its offerings, but with a few twists. In addition to passive investment options, TIAA Personal Portfolio will offer actively managed funds and socially responsible funds, and when customers open an account online, they will receive specific fund recommendations before they’re asked to fund the account.
“We recognize that there is no ‘one-size-fits-all’ when it comes to personal finances,” said Kathie Andrade, the CEO of TIAA’s retail financial services business, in a statement. “We are expanding the reach of our personalized financial support to more people, including younger generations, and those who value working with a mission-based organization.”
The 100-year old firm is offering the new service to accounts with a minimum of $5,000 in assets for an annual advisor fee of 0.3%.
TIAA Personal Portfolio uses a goal-oriented approach that focuses on meeting specific savings targets, offering five different risk levels, ranging from conservative to aggressive, and three different strategies: passive, active and impact.
The passive strategy, known as Basic, invests in low-cost index funds and ETFs. The active strategy, called Insight, is made up of funds that seek to outperform the market over the long term, and Impact prioritizes funds that meet socially responsible investing criteria without sacrificing returns. TIAA has been offering SRI funds since 1990.
The funds included Personal Portfolio are not limited to TIAA funds. They also include iShares ETFs as well as mutual funds from AMG, American Century, American Funds, Federated, Harding Loevner, Jensen Investment Management and USAA.