Happy Friday, readers! It’s a common saying in the retirement plan industry that the back-end of the savings effort (i.e., spending down accumulated assets in a sustainable and efficient way) is far more complicated than the accumulation effort. This is because plan participants all have different longevity expectations, different beliefs about how they would like to live in retirement, and different conclusions about how to weigh longevity risk versus the risk of under-consumption. Making matters even more difficult, survey data shows that plan sponsors are not necessarily thinking strictly about annuities when contemplating the addition of an in-plan retirement income option. Despite this, recordkeepers and asset managers most commonly point to an annuity-based product as being top-of-mind for plan sponsor clients. Will 2019 deliver greater clarity on this vexing topic?
According to Cerulli research, the various parties involved in the implementation of an in-plan retirement income solution are often not on the same page about basic terminology and definitions.
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The department believes an oversight bureau, created to assess the financial strength of annuity providers, would help employers and advisers become more comfortable including annuities in retirement plans.
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Nearly all of those who work with an adviser feel they have prepared themselves well for estimating their monthly income needs in retirement, Voya Financial learned in a survey.
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The proposal is intended to help investors better understand these contracts’ features, fees and risks, and to more easily find the information needed to make an informed investment decision.
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Variable annuities continue to face challenges in the wake of transaction processing disruptions caused by the now-vacated DOL fiduciary rule; however, experts anticipate sales to recover as business processes normalize and newer product types come to market.
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The plan being challenged in the latest fiduciary breach lawsuit held less than $300 million as of the start of last year, making it one of the smallest to become the target of an ERISA complaint.
Advisers and broker/dealers hoping to work with open multiple employer plans now have a short window to offer their perspectives to the Department of Labor and the Internal Revenue Service.
The main theme of the new fiduciary rule proposal is alignment with other regulators—the SEC and FINRA in particular—but the agency is by no means surrendering its jurisdiction over tax-qualified retirement plans.
