NAPA Net - Polling Places 120922

Is The Timing (Finally) Ripe for Retirement Income?

Some have said that this could be the year for retirement income – a combination of new offerings, volatile markets, and rising interest rates. What’s your opinion?

It’s ironic that programs designed to provide retirement income pay so little attention to the realization of that objective.

Ironically, to this day only about half of defined contribution plans currently provide an option for participants to establish a systematic series of periodic payments, much less an annuity or other in-plan retirement income option.

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* 1. What explains slow participant take-up (check all that you think are factor(s))?

They don’t have the option (or don't recognize it as such).

They don’t understand the option.

They don’t feel they need the option.

They have other options.

They're just not thinking about it.

additional thoughts or comments?

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* 2. Some have said that this could be the year for retirement income – a combination of new offerings, volatile markets, and rising interest rates. What’s your opinion?

Yep - the stars seem to be aligned.

Too soon to say.

Not a chance.

No opinion.

If anything, the uncertainty will preserve the status quo.

additional thoughts or comments?

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* 3. There are three provisions in the SECURE Act intended to expand the awareness and/or take-up of lifetime income options – both in terms of expanding access to these options and increasing participant awareness. Now, arguably COVID may have delayed adoption or impact of these - but how would you rate them in terms of effectiveness in the longer-term (say 5 years)?

	Big Impact	Some impact	No impact
Participants projections of their current account balance as a monthly benefit using assumptions prescribed by the Secretary of Labor.	Participants projections of their current account balance as a monthly benefit using assumptions prescribed by the Secretary of Labor. Big Impact	Participants projections of their current account balance as a monthly benefit using assumptions prescribed by the Secretary of Labor. Some impact	Participants projections of their current account balance as a monthly benefit using assumptions prescribed by the Secretary of Labor. No impact
Expanded fiduciary safe harbor for the selection of a guaranteed retirement income provider	Expanded fiduciary safe harbor for the selection of a guaranteed retirement income provider Big Impact	Expanded fiduciary safe harbor for the selection of a guaranteed retirement income provider Some impact	Expanded fiduciary safe harbor for the selection of a guaranteed retirement income provider No impact
Expanded portability - permits special distributions of a “lifetime income investment” when the investment is no longer authorized to be held under the plan.	Expanded portability - permits special distributions of a “lifetime income investment” when the investment is no longer authorized to be held under the plan. Big Impact	Expanded portability - permits special distributions of a “lifetime income investment” when the investment is no longer authorized to be held under the plan. Some impact	Expanded portability - permits special distributions of a “lifetime income investment” when the investment is no longer authorized to be held under the plan. No impact

comments?

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* 4. What (if anything) do you think might "move the needle" in terms of plan sponsor adoption of these options (check all that apply - and yes, many of these already exist)?

Options integrated with target-date fund glidepaths.

Stand-alone annuity purchase options as a distribution choice.

Less expensive annuity options.

Pre-screened annuity options.

Clear(er) protections for plan fiduciaries in selecting the options.

The enhanced fiduciary clarity in the SECURE Act should be sufficient.

Nothing - this really isn't a plan sponsor/fiduciary responsibility.

something else? Care to comment further?

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* 5. Other comments about retirement income, your feelings about retirement income, plan sponsor perspectives on retirement income, the impact (if any) of the SECURE Act's provisions, the enthusiasm (or lack thereof) among participants for the option, the amount of action versus interest in the alternative, or life in general?

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* 6. What is your role working with retirement plans?

Advisor

Provider

TPA

Plan sponsor

Recordkeeper

Wholesaler

Consultant

Other (please specify)

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* 7. What size plans do you PRIMARILY work with?

Under $10 million in assets

$10-$20 million

$20-$50 million

$50-100 million

$100 million - $250 million

$250 million - $500 million

Above $500 million

Other (please specify)

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* 8. Suggestions for future survey questions? Seriously - what would you like to know about/from your fellow NAPA-Net readers? Or what would you like to be asked?

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* 9. All responses are confidential, of course - but just in case you would like a response - or want me to know you responded - or just want to say hi - here's your chance to do so (don't forget your email)!