Early Groundwork Is Key for Implementing Lifetime Income Solutions

Adding a lifetime income solution to a defined contribution (DC) plan can be one of the most important decisions plan sponsors can make, because these solutions may help put participants on a path to achieving security in retirement. Establishing a thorough process and following best practices may help keep things on track when moving from intention to implementation.

Part of the journey involves narrowing the burgeoning field of solutions to a short list worthy of closer evaluation. We think working through four key questions can help whittle down the offerings in play. As this list takes shape, plan sponsors can lay the groundwork for a smooth implementation by engaging early—and productively—with key workstreams.

Based on our experience in partnering with plan sponsors, here are a few considerations:

Talk to recordkeepers about the intent to offer a lifetime income solution. Recordkeepers are vital gateways to plan participants, through regular touch points ranging from account statements to customer-service calls and educational content. All these elements will need to incorporate information on the lifetime income solution to maximize the positive impact on participants.

Some recordkeepers are more comfortable being facilitators between solution providers and individuals; others take great pride in creating a holistic financial-education experience for individual participants. Recordkeepers, always key stakeholders in making solutions work, may need to go a step further to integrate them into their participant experience.