Today Prudential unveiled what it described as a new retirement-plan solution that is “specifically designed to deliver guaranteed lifetime income, downside income protection, and growth potential for individuals with assets in target-date or life-cycle funds, or in asset-allocation programs.”
In an announcement, the firm said that Prudential IncomeFlex Target (IFX Target) ensures that participants won’t outlive a certain level of income by integrating a guaranteed, lifetime income product into target-date funds. The firm said that IFX Target also protects retirement income against market downturns and allows participants to capture potential market upswings, which is “an especially attractive approach given the market turmoil we’ve all experienced recently,” noted Christine Marcks, president, Prudential Retirement, a business of Prudential Financial Inc.
“We want to help American workers retire more securely,” said Marcks, “so, we’re extremely pleased to offer Prudential IncomeFlex Target, a smart solution that will ultimately increase the number of retirement-plan participants with access to a guaranteed, lifetime retirement-income option. And, as recent market volatility has shown, if participants wait until retirement to start protecting their income, it may be too late.”
According to the announcement, Prudential’s IFX Target provides “a guaranteed stream of lifetime income for participants, control over their assets, the potential to capture market growth, and protection from market downturns.” Prudential also said that, “unlike other retirement-income products, such as traditional annuities,” the product does not require annuitization to receive guaranteed income. The fee for the IncomeFlex Target benefit is in addition to investment management charges. Guarantees are based on the claims-paying ability of the issuing company.
Prudential’s IncomeFlex Target Funds are separate accounts available under group variable annuity contracts issued by Prudential Retirement Insurance and Annuity Company (PRIAC) in Hartford, Connecticut.
The IncomeFlex product is one of a number of guaranteed income products for 401(k) plans (see “The Inside Story’).