With research showing that 56% of working Americans plan to utilize workplace-offered advice services in 2024,[1] Voya Financial announced the launch of a new dual Qualified Default Investment Alternative (QDIA).
As the latest addition to its suite of advice and guidance solutions, the firm’s new QDIA is intended to provide plan participants with more-personalized retirement investments and broader sophistication for asset allocation through a default option that evolves as participants age, the announcement explains.
The solution includes a default investment starting as a target-date fund (TDF), which could be a single fund, a TDF series or a set of asset allocation funds. When participants reach a certain age (generally around age 50), they are automatically transitioned to any of the managed account programs supported by Voya, including the firm’s Advisor Managed Account solutions and additional proprietary offerings.
“At Voya, we find that individuals nearing retirement are in need of a more holistic approach that not only supports their unique retirement goals and more-complex investment needs but also ensures that they are prepared to generate a sustainable retirement income stream,” explained Andre Robinson, Senior Vice President, Retail Wealth Management and Advisory Solutions at Voya Financial. “Helping our clients gain access to managed accounts can help with these needs.”
To that end, Robinson adds that they are seeing growing interest in managed account solutions from retirement plan participants. In fact, total assets in Voya’s managed account solutions were up 28% in 2023, compared to the previous year.
“As a result, we believe establishing a dual QDIA—one designed to address both the needs of younger accumulators and near-retirees—can serve the needs of today’s broad and diverse workforces,” Robinson noted.
Voya’s dual QDIA also provides ERISA 3(21) and 3(38) fiduciary support, with Voya Retirement Advisors (VRA) serving as the registered investment advisor (RIA). Employees will also be provided with an integrated participant experience, which—along with VRA RIAs and access to advice and guidance solutions—can help participants get personalized support, the announcement further explained.
The option is now available across Voya’s various managed account programs within Voya-administered retirement plans. The new solution will also be available to intermediaries that currently work with Voya to support their Advisor Managed Account programs.
“We continue to offer managed account programs to all of our plan sponsor clients, with adoption and interest continuing to grow as we expand our solution set,” stated Jason White, director of Advisory Services at Voya Financial. “We also know that education is critical to success when it comes to participant engagement. In 2023, we found participant enrollment improved 10% over the prior year, which was largely driven in part by the introduction of new solutions but also by targeted enrollment campaigns to help improve engagement.”
[1] According to Voya’s research, more than half (56%) of working Americans have said they are “extremely likely” or “likely” to utilize workplace advice services (i.e., managed accounts) to better understand their overall savings picture in 2024.
