Q&A addresses common questions about Pitt’s retirement funds


The University Senate’s Benefits and Welfare Committee hosted a Dec. 14 Q&A concerning Pitt’s retirement fund options and performance on Dec. 14, with committee chair Linda Tashbook interviewing members of Pitt’s Retirement Oversight Committee; Tim Irvin, senior financial advisor at CAPTRUST, the company employed by Pitt to oversee the funds; and others.

The oversight committee is now chaired by new Vice Chancellor of Human Resources James Gallaher, who has served on such committees at his previous institutions.

Tashbook, foreign and international comparative law librarian in the School of Law, said 125 attendees heard answers to common questions members of the committee hear from fellow employees.

“We wanted to remind our faculty and staff that quietly in the background their money is piling up for retirement and we have smart and thoughtful experts keeping those investments as secure as possible,” she said.

Who is monitoring our retirement investments?

John Kozar (assistant vice chancellor, University Benefits), cited the Retirement Oversight Committee’s expertise as a key factor in monitoring employee investments in retirement funds, which are administered through TIAA. Pitt also employees Cammack (now part of CAPTRUST) as an independent investments monitor. CAPTRUST works with the oversight committee to analyze quarterly the 50 funds available through the retirement plan, meeting with investment managers for all funds in the plan on a regular basis.

How were these funds selected? Why do we only have 50 funds to choose from? Do the funds chosen ever change? What about socially responsible funds?

Although “we’re looking at the entire universe of funds” for possible inclusion as an offering, Irvin said, the 50 chosen funds were selected because their managers perform well, and to consolidate investment choices in certain asset classes.

“That sort of review is not something the individual investor” could easily do, given the choice of every fund available in the market, said Sharon Smith, Retirement Oversight Committee member and formerly Pitt–Greensburg president, president of the NASDAQ Stock Market Educational Foundation and a governor of the National Association of Security Dealers. For instance, Smith said, if a fund manager retires — about which the average person may not be aware — the oversight committee and CAPTRUST look carefully at how the fund continues to do under new management.

Mari Tsagareishvili, senior analyst at CAPTRUST, noted that her company may recommend that an underperforming fund be replaced if its success is lower than expectations or worse than its peers.

Smith also noted that the oversight committee looked, during its most recent meeting, at environmental, social and other such factors among Pitt’s investment options, and wants to make these considerations are a part of their formal examination process — as long as the chosen funds continue to give members the retirement assets they seek, she cautioned.

Some of these funds aren’t the highest earning funds — why is that? 

Tsagareishvili pointed out that, when CAPTRUST performs its various analyses of funds’ health, it looks at risk relative to peer funds, rather than which fund is the top earner at that moment, since no fund stays atop such lists for the length of any quarter. CAPTRUST also examines how well managers do in different markets (booming, shrinking and everything in between).

“There’s always risk with any investment,” Kozar added. Early in your career you may invest in funds that have a higher risk but also have the greatest growth potential, he said. Later, as you get closer to retirement, you may be looking for more stability in the funds.

“With a retirement account,” Irvin said, “you’re not looking to day trade, and you’re not looking for the one best performer” over the short term. You’re looking for performance over the long term across varying markets — not for home run sluggers, he said, but for consistent hitters of singles and doubles.

Do the fund choices ever change? Why do we only have 50 funds to choose from, when there are thousands of funds in the marketplace?

“You want to be able to monitor the funds and make sure they are performing up to the standards you want,” Smith said, as well as each fund’s fee levels, and thus need a manageable number of offerings.

Irvin noted that a reduced number of fund offerings reduces overlap, so that investors don’t falsely believe they are diversifying by spreading their investment across funds that actually duplicate each other significantly. There are also cost efficiencies to having larger aggregates of Pitt retirement money in single funds, he said, since that reduces fees.

“We field questions like this all the time,” Irvin said. “I just think it’s about creating a balance,” since, with greater than 30 options, retirement investment participation can drop as investors become uncertain what to do — and end up doing nothing.

Do I have to invest in just these mutual funds? Are there other options?

Irvin pointed out that employees may actually invest in any fund via the system’s self-directed brokerage window. Links to the brokerage window, and all account information in the TIAA dashboard, are available via Human Resource’s benefits page or via my.pitt.edu (search for “TIAA” or “retirement” to access your account).

Kozar said that the brokerage window is only used by 114 members currently.

“Then they are depending on their own personal research and instincts” rather than the oversight committee’s and CAPTRUST’s research and expertise, Smith said.

Advice on how to use the brokerage window is available through TIAA and Morning Star, which is employed by TIAA to give independent financial advice. You also can connect to these services through Pitt’s benefits office.

Where can I find out how my retirement investments are performing?

TIAA gives Pitt employees using its services quarterly reviews, which may be examined via the TIAA dashboard, described above.

Tashbook, following the session, emphasized that, although faculty and staff access their retirement investment information through the TIAA dashboard, and some of the 50 funds offered are TIAA funds, Pitt employees do not need to have any of their money invested in TIAA funds if that is their choice.

Do I have to wait until an open enrollment period to change my retirement investments? 

“You can make changes in those investments at any time,” said Melissa Kluchurosky, Pitt’s manager of benefits, retirement savings plans, life insurance, and leaves. Jay Mahoney, senior relationship manager at TIAA, explained that such changes, if completed before 4 p.m., will be effective that day; if completed later, they will be effective the next day.

Kluchurosky added that you can change your contribution levels at any time, although there will be a longer period before they take effect.

 “These investments belong to you,” concluded Tashbook, “and you decide when and how to make changes.”

Marty Levine is a staff writer for the University Times. Reach him at martyl@pitt.edu.


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