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Another Retirement Income Solution Emerges

Service Providers

State Street Global Advisors has announced the launch of a new deferred lifetime income solution, developed in partnership with the University of California (UC).

According to a Nov. 29 press release, IncomeWise™, a deferred lifetime income solution, has launched within the UC’s defined contribution plans, which serve more than 300,000 participants and include over $34.6 billion in assets.

The Deferred Lifetime Income at UC product was introduced into Pathway, the university’s target date fund, in August 2021. It was described as a “next generation solution that blends the flexibility and simplicity of traditional target date funds with the security of guaranteed lifetime income.” 

“The University of California has been researching how best to evolve our Retirement Savings Program to help participants save during their working years and live long comfortable lives in retirement,” said UC Chief Investment Officer Jagdeep Singh Bachher. “People are living longer, with smaller pensions due to shorter job tenures. Given market volatility, there’s now a strong need for a supplemental source of guaranteed income in the later years of life. Deferred Lifetime Income is an innovative solution and an important step toward improving retirement security for our participants.”

IncomeWise™ uses State Street’s target date glidepath to help participants accumulate wealth during their savings years, and then a portion of these savings can then be converted into a guaranteed income stream for later years of retirement by purchasing a qualified longevity annuity contract (QLAC). 

State Street says it has worked in partnership with Fidelity to implement Deferred Lifetime Income as a custom solution on behalf of UC. Additionally, State Street conducted a vetting process of insurance providers, culminating in the selection of Metropolitan Tower Life Insurance Company as the annuity provider for the 2021 annuitization.

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