After President Obama’s Middle Class Task Force began the process of promoting annuities, the US Department of Labor (DOL) and the Treasury have put out a request for information, according to Money Management Executive’s “Treasury, Labor Dept. Issue RFI on Annuities in 401(k)s. They are seeking out information on the benefits and drawbacks of using 401k annuities transfers to secure retirement income for Americans. Since participants receive income in lifetime installments with annuities, the Treasury and DOL want to ensure that this form will work the best for the most people.
The American Council of Life Insurers was already excited about the Obama administration’s promotion of using annuities in different types of defined contribution plans. They said in a statement that they are happy to provide information about the products to the Treasury and DOL. The Insured Retirement Institute (IRI) will also be putting together annuity information for the departments to use in their research. The government worries that an increasing number of retirees are opting for lump sum payments of their 401k or other plans. With annuities, they purchase the product with that retirement money and receive a stream of income payments monthly that are guaranteed over a lifetime. The departments’ RFI will help them gather more information for government recommendations.