In response to the Setting Every Community Up for Retirement Enhancement (SECURE) Act, annuity heavy weight, Nationwide has announced the launch of a new suite of in-plan annuity products and partnerships with industry leaders. The line, which will be implemented from late 2020 through 2021, will include at least five new solutions.
“We know this is not a one-size-fits-all problem, and we’re confident that a suite of solutions will give plan sponsors the flexibility to select the option that’s best for their participants,” said Eric Stevenson, president of Nationwide Retirement Plans. “Our approach is unique, by going beyond retirees’ well-established need for guaranteed income, to also address their growing need to protect principal. It’s the combination of both benefits that makes our approach a game-changer for our industry.”
The company believes that the SECURE Act provided an opportunity for retirement plan sponsors to help their participants live in retirement. For example, the SECURE Act made in-plan annuities within defined contribution (DC) plans such as 401(k)s and 457(b)s more accessible and portable.
Nationwide plans to introduce a new in-plan fixed indexed annuity in December that is geared towards providing principal protection with potential for growth, based on the return of an index. In 2021, the provider will follow-up with several in-plan lifetime income options that pair income guarantees with target-date funds (TDFs). These options will all be qualified default investment alternative (QDIA) compliant.
“Similar to a target-date fund, we will allow our plan participants to select an investment option and then we’ll take care of the rest of the puzzle by providing a glide path from accumulation into retirement income,” Stevenson says.
Written by Rachel Summit