Letter to investors

Global financial markets produced mixed results for the twelve months ended
May 31, 2020, as the effects of the COVID-19 pandemic persisted. U.S. equities
posted double-digit gains amid continued economic growth for most of the period.
Foreign stocks declined, with international developed markets faring better than
emerging markets. U.S. fixed-income securities delivered strong gains as U.S.
Treasury yields fell sharply across all maturities (bond prices move in the
opposite direction of yields). These market conditions were reflected in the
performance of the TIAA-CREF Lifecycle Funds by way of their investments in
various asset classes through underlying funds.
All twelve TIAA-CREF Lifecycle Funds delivered positive returns for the period;
however, all trailed their respective composite benchmarks. (All fund returns
are for the Retirement Class.)
Returns for the Retirement Class ranged from 5.9% for the Lifecycle
Retirement Income Fund to 6.5% for the Lifecycle 2040 Fund.
These results continued to support the solid performance of the TIAA-CREF
Lifecycle Funds over longer periods of time.

U.S. markets rose while international equities fell

U.S. equities advanced for the twelve months, despite the negative impact of the
COVID-19 pandemic. The broad domestic stock market, as represented by the
Russell 3000®Index, gained 11.5%. The U.S. economy grew at a steady pace for
much of the period but contracted at an annualized rate of 5.0% during the first
quarter of 2020. To help stimulate the economy, the Federal Reserve cut the
federal funds target rate twice in March 2020 to 0.00%–0.25%, having already
reduced the key short-term interest-rate measure three other times during
the period.
International stocks did not perform as well as their U.S. counterparts. The
MSCI ACWI ex USA Investable Market Index (IMI), which measures the
performance of large-, mid- and small-cap equities in 22 of 23 developed-markets
countries (excluding the United States) and 26 emerging-markets countries,
returned –3.4% in U.S.-dollar terms. In January 2020, the United States and
China signed phase one of a trade deal in which the United States would reduce
certain tariffs on Chinese products in exchange for China’s agreement to
purchase more American farm, energy and manufactured goods.
U.S. investment-grade bonds climbed higher amid the Fed’s rate cuts and
Treasury yield declines. The domestic investment-grade fixed-rate bond market,
as measured by the Bloomberg Barclays U.S. Aggregate Bond Index, gained 9.4%
for the period.

4 2020 Annual Report TIAA-CREF Lifecycle Funds