Advisors

The pendulum has swung back and forth on 401k/403b investment menus.  Limited choices were replaced with dozens of choices across multiple asset classes, only to be reduced again to what is now a more understandable and actionable, offering of 10 to 12 investment options.  At the same time, “safer” options that don’t keep pace with inflation have widely been replaced with higher yielding target date funds.

As an advisor, it’s critical to keep up with evolving plan sponsor needs.  In a world without pensions, one of these emerging needs is lifetime income features in the 401k/403b investment menu to help participants with retirement income security, i.e., longevity risk.  Lawmakers share this view.  Proposed “safe harbor” legislation should soon pass to make it easier for retirement plan fiduciaries to select annuity providers.

ANNUA is helping to pioneer lifetime income features to address the longevity risks inherent with most 401k/403b plans.  We believe the next wave of product innovation and plan sponsor demand will be for Accumulation Annuities during an employee’s working career.

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