We all know that someday, retirement income solutions will be prevalent for people retiring with assets in DC plans and IRAs, which currently include more than half of all retirement assets and will only grow in the future. The big questions are when, and which products. Many plan sponsors claim that they are waiting for DOL guidance to make bold moves, as United Technologies has already done. So it will be interesting to watch as the state of Florida seeks a new lifetime income provider for its $8.2 billion 401(a) plan.
The incumbent provider, Hartford, is exiting the business and declined to bid. The current plan has $25 million invested in annuities. With $171.1 billion in the system, 76,000 401(a) participants having taken $6.7 billion in distributions since 2012, and the very likely possibility that new participants will be pushed in the DC-like system, it should be interesting to watch what happens in Florida.
