Regardless of plan sponsor sentiment, there’s also a pretty consistent understanding that advisors will wind up playing an essential role in overcoming the traditional objections to these solutions.
So, we asked advisor attendees at the 2023 NAPA 401(k) Summit—our Summit “Insiders”—what, in considering a retirement income solution, factors would be most influential/compelling to consider recommending the option to your plan sponsor clients.
Respondents were able to choose multiple categories—and as you can see below, portability was, far and away, the top consideration:
- Portability – 407
- Platform agnostic – 287
- Income guaranty – 247
- Convenience – 238
- SECURE Act compliant – 190
- QDIA-friendly – 115
- If it were part of a target-date fund offering – 101
Select Shuns?
There are, of course, a number of different solutions currently available. And we asked respondents which retirement income option(s) they thought plan sponsors should consider or offer to participants—and, of course, more than one option was allowed:
- Access to guaranteed lifetime income options – 301
- Systematic and/or flexible withdrawal options available through the recordkeeper – 292
- TDFs that transition participants into guaranteed lifetime income as they near retirement –256
- Managed account service that provides participant retirement income – 206
- Non-guaranteed investment options to help support retirement income (e.g., stable value, income-oriented bond funds, in-retirement target date fund) – 159
Check out the rest of the 2023 NAPA Summit Insider at: https://bit.ly/23Summitinsider1
