hand using letter cubes to spell out annuity (Photo: Shutterstock)

In 1952, The Teachers Insurance and Annuity Association (TIAA) sold the first variable annuity (VA) developed by Harvard Ph.D. economist William Greenough to Brown University President Henry M. Wriston. Since then, over a million education employees have invested in VAs through the TIAA College Retirement Equities Fund (TIAA-CREF). The original VA was seen as a creative solution to the retirement income puzzle.

The variable annuity concept as originally envisioned is remarkably simple. The initial purpose of the VA was to provide a higher income to retirees than fixed annuities, for the trade-off of removing the stronger guarantees that fixed annuities provide.

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