1) What’s the deal with the Memorial Sloan Kettering 403(b)? Is it really a good plan?

Yes — the MSK 403(b) is one of the stronger retirement plans you’ll find in a large academic medical center. The plan uses TIAA‑CREF, a highly reputable provider that’s known as one of the most customer friendly insurance companies. On top of that, to our knowledge the plan offers a self-directed brokerage account, which gives you the flexibility to tailor your investments as you approach retirement. For a physician in your late 50s or early 60s, that flexibility — particularly for income-focused and bond funds — is very valuable.

2) How do I know whether the fund menu is “good enough” for someone close to retirement?

Overall, Memorial Sloan Kettering's fund lineup is very good in our view, with lots of high quality low cost funds, but you do have to be selective. Some funds have higher fees than ideal, and at your stage, fees matter more than ever because they erode returns over time.

One weakness of the Memorial Sloan Kettering 403(b) is that it has some funds with expense ratios well over 0.50%. You can likely get around this using the self directed brokerage account - but a plan this size should probably try to not have any funds with expense ratios above 0.50% if possible.

So for example, the 403(b) includes the Principal Global Real Estate Securities Fund Class R6 with an expense ratio of 0.90%, when other firms like Vanguard offer similar products with an expense ratio of about 0.11%. Here is an example of a less expensive Vanguard product: https://investor.vanguard.com/investment-products/mutual-funds/profile/vgrnx

This is not a recommendation to include the Vanguard product and a plan trustee is always able to use a more expensive fund if they believe it is in the interest of the employees, but on a big plan like the Memorial Sloan Kettering 403(b) the plan trustee is always going to want to very sensitive about mutual funds with fees above 0.50% because a big plan like this can generally qualify for lower fees. For example, the Vanguard product used above as an example requires $5 million in employee assets to get access to that fund and that might be a prohibitive balance for a super small emergency group or radiology group to qualify for - but with around $6.4 billion in plan assets in the Memorial Sloan Kettering 403(b) as of the time of this writing 11/25/25, Memorial Sloan Kettering will generally qualify for the best pricing on investment products because they can be bought in bulk

3) How much does Memorial Sloan Kettering contribute for me — and does it matter this late in my career?

Yes, it still matters. Moreover, MSK offers a very generous employer contribution: if you contribute 3% of your salary, the organization contributes up to 8% (assuming you’re over 31, which obviously applies). That’s essentially free money boosting your retirement balance, even if retirement is only a few years away. For physicians in your situation, maximizing that match can significantly reduce the pressure of converting savings into income later.

4) When do I become fully vested in those employer contributions (i.e., when is it truly mine)?

To our knowledge, you become fully vested at age 55, or after three years of service. If you’re already in your late 50s or early 60s, chances are you’re fully vested or close to it. That means any employer contributions — plus their growth — are fully yours. That’s an important piece of certainty when you start planning how to turn your 403(b) into income.

5) Should I consider rolling over my 403(b) into an IRA when I leave or retire from MSK?

In many cases — yes. Even though the MSK 403(b) is excellent, an IRA can offer more control, flexibility, and often lower costs. For someone near retirement, this can be especially beneficial: you can build a customized income strategy using a mix of income-focused funds, annuities, or other investments. You also get more control over withdrawals, which helps with tax planning and longevity risk. Rolling into an IRA doesn’t always make sense for everyone for example, you can lose some creditor protection in some IRAs so some people may choose to keep money in a 403(b) or you may want to annuitize your 403(b) in which case it might make sense to use the plan's bulk buying power - but most of the time in our view people usually benefit more from rolling over a 403(b) to an IRA than keeping the money in the 403(b).

Of course, this is a highly individualized decision and you have to do your own research or talk to your own advisors before making any financial decisions.

6) How can I convert my 403(b) (or rollover IRA) into a dependable income stream?

Here’s a generally recommended approach for physicians 55–65:

In a 403(b) you can annuitize it - essentially you transfer your retirement to an insurance company. Usually your heirs won't get anything but the insurance company bears the risk that you live a really long life.

Now although it is rare you need to account for the fact that an insurance company can go bankrupt. Most states have fairly small guaranties if your insurance company goes bankrupt

In New York State, for example, annuities may be guaranteed up to $500,000 for named beneficiaries or $1,000,000 for unnamed group beneficiary contracts. So if you had a $1,000,000 403(b) and gave it to an insurance company and they went bankrupt the next day, the state insurance association may only give you $500,000 and the other $500,000 could be lost.

Here is an FAQ on insurance guaranties in New York if you are considering purchasing an annuity or converting your 403(b) into an annuity: https://www.nylifega.org/FAQ

But the positives of an annuity is if the insurance company doesn't fail, and we've covered insurance company failures here.

If you aren't using annuities, investments also tend to be highly effective at creating dependable income. It can be useful to be informed about the options since what works tends to change over time based off market conditions. If you are interested in learning more about the options it can be beneficial to talk to a fiduciary financial advisor.

7) What do I need to watch out for — what are the risks or “gotchas”?

• High-fee funds: Some of the funds have expense ratios above what we’d call ideal. These quietly erode your savings over time and may not be competitive with some of the alternative investment options out there.

• Longevity risk: As a physician, you may live many decades in retirement. If you withdraw too aggressively early on, you could outlive your savings.

• Sequence-of-returns risk: If you retire and markets drop, you don’t want to be forced to withdraw from a down market. A laddering or annuity strategy helps mitigate that.

• Tax planning: If you don’t manage withdrawals carefully (from a 403(b) or IRA), you could trigger higher taxes or impact Medicare premiums.

8) Does it make sense to keep part of the money in TIAA (e.g., annuity/income products) and part in a more traditional investment account?

In our view most of the time for most people the answer is no. 403(b)s can offer annuities at competitive pricing with lower fees and so if you want an annuity this is something to consider.

Of course with annuities you should understand what you are buying is a contract with one company. If that company fails you lose all the money that you put into it minus what the state guaranty association will make you whole with. Essentially it is a hyper-concentrated investment in one company.

An annuity can work as part of a diversified portfolio - but annuities have large concentration risks if you are above the insurance guarnaty limits in your state and they are often not inflation adjusted which means they lose value over time in a way that a retirement portfolio wouldn't always do. But if you want an annuity, keeping some funds in a 403(b) definitely make sense in our view.

If you don't want an annuity in most cases it makes sense to roll over a 403(b) into an IRA upon retiring or leaving an employer. While you may lose some minor creditor protection if you reside in New York according to this attorney - most of an IRA may be creditor protected, just like a 403(b). Source: https://marksklein.com/protection-of-retirement-accounts-and-investments-from-creditor-claims/#:~:text=Employer%20sponsored%20retirement%20plans%20such,spouses%20can%20attach%20the%20funds.

Neither Daniel Harris nor D.R. Harris & Co are licensed to practice law in New York and we are not qualified to advise you on New York law. Our statement is written in reliance to what we read on a lawyer's website who practices in New York. If you are unsure of the IRA creditor protection in your state you should contact an attorney licensed to practice law in your state to explain the rules to you.

If you live outside New York you may want on consult the following website to learn more about creditor rules in your state: https://www.thetaxadviser.com/wp-content/uploads/sites/2/2014/01/stateirachart.pdf

Of course, before relying on any of this information - we recommend consulting with a licensed attorney in your state because the rules can change.

9) What’s the bottom line for a physician in their late 50s or early 60s?

Your MSK 403(b) is more than just a retirement account — it’s a powerful tool for building a stable, reliable income in retirement. By taking full advantage of the employer match, watching fund fees, and thoughtfully considering a rollover, you can turn your savings into a paycheck that lasts decades. The strength of TIAA, combined with careful planning, means you don’t have to panic about volatility, longevity, or sequence risk — you just need to build the right plan.

10) What should I do next if I want to turn my 403(b) into income I can count on?

• Review the fund lineup and identify lower‑cost, income- or balanced‑oriented funds (especially with expense ratios under 0.50%).

• Calculate how much income you’ll need in retirement and estimate how much you could safely withdraw annually (a fiduciary financial advisor can be a big help with this)

• Consider rolling over to an IRA for more flexibility, or at least evaluate the pros and cons.

• Learn how to convert your assets into income in a sustainable way. If you don't personally know how to do this consider consulting with a financial advisor who is a fiduciary.

• Factor in taxes, Medicare, and other sources of retirement income (Social Security, savings, etc.), and create a withdrawal schedule that manages these efficiently.

If converting assets to income in a sustainable way is something that you are nervous about and you'd like to work with a fiduciary financial advisor, feel free to fill out the following form to request a 10 minute get to each other introductory phone call.

On this phone call we'll discuss your goals, what you are hoping to achieve and see if it feels like a mutual fit to talk further and explore whether working together is a mutually good idea.

Disclaimer: This article is written for educational purposes only. Neither Daniel Harris nor D.R. Harris & Co. are your tax, legal or investment advisor unless you have a written advisory agreement with us. While we believe the information in this article is correct at the time of its writing, we encourage you to consult with your employer, do your own research and talk to your own professional advisors before acting on any information you learned about in this article.