KANSAS CITY, Mo., March 3, 2021 /PRNewswire/ -- A consortium
of leading retirement firms that includes American Century
Investments, Lincoln Financial Group, Nationwide, Prime Capital
Investment Advisors, SS&C Technologies, Wilmington Trust, N.A.
and Wilshire today announced the
launch of a new in-plan target date series with guaranteed income*
for life designed to help retirement plan participants transition
from the accumulation phase of retirement investing to the
decumulation stage. Called "Income AmericaTM 5ForLife,"
this new solution, which is designed to be used as a plan's
Qualified Default Investment Alternative (QDIA), strives to address
one of the most pressing issues for those at or near retirement:
the need for guaranteed monthly retirement income.
American workers see great value
in products that provide guaranteed income in retirement, according
to participants in a consumer study on this topic1. More
than seven in 10 surveyed said they would use a guaranteed income
product if offered in their employer-sponsored retirement plan. The
same number said these solutions would make it easier to budget
their money in retirement, and they would feel more confident in
preparing for retirement. Plan participants are also focused on
protecting their savings from market volatility — as a result of
the financial impacts of COVID-19, half of retirement savers are
more concerned about future market volatility than they were before
the pandemic2.
"Working together with our
retirement industry partners, we developed the 'Income America'
consortium to offer a defined contribution solution that helps plan
participants concerned about outliving the money they've set aside
for retirement," said American Century Investments President and
Chief Executive Officer Jonathan
Thomas. "Our recent 2020 Retirement Plan Participant study
indicates that more than 80 percent of participants would keep
their assets in their retirement plan if they had an income option.
We believe Income America provides an innovative approach to
helping more people achieve a successful and comfortable
retirement."
How Income America
Works
Income America is a
series of portfolios built on a target date glide path designed by
American Century and held in a portable, non-proprietary,
multi-manager Collective Investment Trust (CIT). It is available as
both a traditional series of target date portfolios, Income
America, and as a companion series of target date portfolios with
an in-plan Guaranteed Lifetime Withdrawal Benefit (GLWB), known as
Income America 5ForLife. Either series can be used as a plan's
QDIA. The pricing power of the consortium firms allows Income
America to deliver a cost-effective Collective Investment Trust
vehicle, resulting in lower fees for participants. Income America
5ForLife is designed to be SECURE Act-compliant and to meet ERISA
404 and 3(38) fiduciary requirements, relieving plan sponsors of
liability for the screening of GLWB providers, fund managers,
stable value managers and glide path managers. Both Income
America series are competitively priced and Income America 5ForLife
is portable among major recordkeepers where Income America 5ForLife
is available. Both series are fully liquid, and participants can
withdraw their Income America account balance from the series at
any time without penalty.
"By partnering on this important
new solution, we look forward to continuing to help retirement plan
participants not just understand how to save for the retirement
they envision, but help them take those savings and translate them
into a monthly check that will last through retirement," said
Jamie Ohl, Executive Vice President,
President, Workplace Solutions, Head of Life & Annuity
Operations, Lincoln Financial Group. "As more Americans rely on
their workplace retirement plan as their primary savings vehicle,
it is more important than ever that we focus on the outcomes that
will help them build financial security — because in planning for
retirement, the ultimate outcome is income."
By offering Income America
5ForLife in their retirement plan, employers can help ensure their
employees will have access to a protected, guaranteed stream of
income in retirement, giving them more confidence in their
financial futures. When a plan participant moves accumulated
retirement assets to Income America 5ForLife, the initial value of
the account plus ongoing contributions (less withdrawals) establish
an "income base" on which an annual five percent guaranteed
lifetime payment will be based once the income feature is activated
when the participant reaches age 65 or older. If the market value
of the participant's account has appreciated and is more than the
sum of net contributions at age 65, the income base will "step up"
to the higher market value amount (a one-time event) when the
participant turns age 65. Alternatively, if the market value of the
account at age 65 is lower than the amount of net contributions to
date, the income base that determines the payout amount will remain
set at the net contribution level. A joint option is also available
but will lower the payout percentage.
"Income America 5ForLife is the
latest solution that leverages our expertise as a top distributor
of retirement plans and a leading insurer of in-plan guarantees, to
provide plan sponsors and their participants with a simple, low
cost, portable solution to meet their retirement income needs,"
said Eric Henderson, president of
Nationwide Annuity. "According to Nationwide's recent Advisor
Authority study, demand is strong, with two-thirds of Millennial
investors and Gen X investors indicating they are likely to
incorporate in-plan guarantees within their qualified retirement
plans."
Prime Capital Investment Advisors
Chairman Scott Colangelo said, "We
are honored to consult with this diverse group of contributors
on the initial product design. Given the strong interest in these
solutions, we expect advisors and plan participants to gravitate
toward Income America's unique offering."
Consortium Member Roles and
Responsibilities
- American Century Investments: Target date glide path provider
and underlying fund manager; firm's glide path is designed to
provide greater certainty of outcomes for a broader number of
participants
- Lincoln Financial Group and Nationwide: Stable value fund
management; recordkeeping platform providers; guaranteed income
providers with S&P life insurance company ratings of A or
better
- Prime Capital Investment Advisors: Product consultant
responsible for product design, including sourcing consortium
partners and providing the investment universe for Income America
5ForLife
- In addition to the primary consortium participants, other
prominent retirement industry firms involved with Income America
include:
- Fidelity Investments, Vanguard, and Prudential: Serve as
underlying fund managers
- SS&C Technologies: Provides the Retirement Income Clearing
and Calculation Platform (RICC), a middleware application designed
to facilitate the efficient distribution and servicing of in-plan
guaranteed income products across various recordkeepers and
participating insurers
- Wilmington Trust: Serves as trustee of the collective
investment trust and ERISA 3(38) investment manager fiduciary
- Wilshire: Investment advisor
fiduciary under ERISA 3(21) responsible for recommending the glide
path manager, GLWB providers, underlying fund products and stable
value offerings to the trustee from an investment universe selected
by the product consultant for each category
MEDIA CONTACTS:
American
Century: Laura Kouri,
laura_kouri@americancentury.com, 816-516-7729
Lincoln Financial Group: Lucy MacNichol, lucy.macnichol@lfg.com,
484-655-4410
Nationwide: Deborah Newman, newmad4@nationwide.com,
502-587-3858
Prime Capital Investment Advisors:
Karyn Baldwin, karyn@gregoryfca.com,
610-909-1789
About American Century
Investments
American Century
Investments is a leading global asset manager focused on delivering
investment results and building long-term client relationships
while supporting research that can improve human health and save
lives. Founded in 1958, American Century Investments' 1,400
employees serve financial professionals, institutions, corporations
and individual investors from offices in New York; London; Hong
Kong; Frankfurt;
Sydney; Los Angeles; Mountain View, Calif.; and Kansas City, Mo. Jonathan S. Thomas is president and chief
executive officer, and Victor Zhang
serves as chief investment officer. Delivering investment results
to clients enables American Century Investments to distribute over
40 percent of its dividends to the Stowers Institute for Medical
Research, a 500-person, non-profit basic biomedical research
organization. The Institute owns more than 40 percent of American
Century Investments and has received dividend payments of
$1.7 billion since 2000. For more
information about American Century Investments, visit
www.americancentury.com.
About Lincoln Financial
Group
Lincoln Financial Group
provides advice and solutions that help people take charge of their
financial lives with confidence and optimism. Today, more than 17
million customers trust our retirement, insurance and wealth
protection expertise to help address their lifestyle, savings and
income goals, and guard against long-term care expenses.
Headquartered in Radnor,
Pennsylvania, Lincoln Financial Group is the marketing name
for Lincoln National Corporation (NYSE: LNC) and its affiliates.
The company had $303 billion in
end-of-period account values as of December
31, 2020. Lincoln Financial Group is a committed corporate
citizen included on major sustainability indices including the Dow
Jones Sustainability Index North America and FTSE4Good. Dedicated
to diversity and inclusion, we earned perfect 100 percent scores on
the Corporate Equality Index and the Disability Equality Index, and
rank among Forbes' World's Best Employers, Best Large
Employers, Best Employers for Diversity, and Best Employers for
Women, and Newsweek's Most Responsible Companies. Learn more
at: www.LincolnFinancial.com. Follow us on Facebook, Twitter,
LinkedIn, and Instagram. Sign up for email alerts at
http://newsroom.lfg.com.
About
Nationwide
Nationwide, a
Fortune 100 company based in Columbus,
Ohio, is one of the largest and strongest diversified
insurance and financial services organizations in the United States. Nationwide is rated A+ by
both A.M. Best and Standard & Poor's. An industry leader in
driving customer-focused innovation, Nationwide provides a full
range of insurance and financial services products including auto,
business, homeowners, farm and life insurance; public and private
sector retirement plans, annuities and mutual funds; excess &
surplus, specialty and surety; pet, motorcycle and boat insurance.
For more information, visit www.nationwide.com. Follow the
firm on Facebook and Twitter.
About Prime Capital Investment
Advisors
Prime Capital
Investment Advisors provides a client-centric team approach to
full-service financial planning, including fee-based asset
management and wealth management through its Prime Capital Wealth
Management brand. PCIA currently has 26 locations throughout
the United States, with investment
advisor representatives serving clients across the nation. Advisory
services offered through Prime Capital Investment Advisors, LLC.
("PCIA"), a Registered Investment Adviser. For more information,
visit www.pciawealth.com.
About SS&C
Technologies
SS&C is a
global provider of services and software for the financial services
and healthcare industries. Founded in 1986, SS&C is
headquartered in Windsor,
Connecticut, and has offices around the world. Some 18,000
financial services and healthcare organizations, from the world's
largest companies to small and mid-market firms, rely on SS&C
for expertise, scale and technology.
About
Wilshire
Wilshire Advisors LLC
is a leading global investment technology and advisory company,
dedicated to improving outcomes for investors worldwide. Founded in
1972, Wilshire advises on over
$1.1 trillion in assets and manages
$76 billion in assets. Specializing
in innovative investment solutions, consulting services and
multi-asset analytics, Wilshire
serves more than 500 institutional and intermediary clients
worldwide, delivering a high quality, coordinated platform of
client-centric investment solutions that leverage the entire firm's
resources to the maximum benefit of our clients. More information
on Wilshire can be found at
www.wilshire.com.
About Wilmington
Trust
Wilmington Trust, N.A.
provides corporate and institution services including institutional
trustee, retirement plan, agency, asset management, and
administrative services for clients worldwide who use capital
markets financing structures. Wilmington Trust provides directed
trustee, custody, and fiduciary services for retirement plans,
companies, foundations, organizations, and financial institutions.
Wilmington Trust also provides Wealth Advisory services with a wide
array of personal trust, financial planning, fiduciary, asset
management, and family office solutions designed to help
high-net-worth individuals and families grow, preserve and transfer
wealth. Wilmington Trust maintains offices throughout the United States and internationally in
London, Paris, Dublin, and Frankfurt. For more information, visit
www.WilmingtonTrust.com.
*Guarantees are subject to the claims-paying ability of the
issuing companies. The income guarantee is based on the income base
at age 65, which is set to the greater of the market value or total
contributions (less withdrawals) to date. The market value of the
account is never guaranteed and fluctuates based on investment
performance. While the market value of the account can be withdrawn
at any time without any fees or penalties, doing so will cause the
loss of the income guarantee.
American Century Investments® provides underlying sub-asset
class and target date glide path management as well as marketing
support for Income America.
www.incomeamerica.com
©2021 Income America, LLC
1 Consumer Opinions on In-Plan Guaranteed Income
Investment Options, Lincoln Financial COVID-19 Sentiment Tracking
Study, September 2020
2 Lincoln Financial & CivicScience Protection
Survey. Data gathered by CivicScience: 6/18/2020 – 6/25/2020
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SOURCE American Century Investments