IncomeWise™ helps defined contribution savers
balance financial flexibility and security in retirement
State Street Global Advisors (State Street), the asset
management business of State Street Corporation (NYSE: STT), in
partnership with the University of California (UC), today announced
that IncomeWise™, a deferred lifetime income solution, has launched
within the University of California’s defined contribution (DC)
plans that serve more than 300,000 participants and include over
$34.6 billion in assets.1
IncomeWise™ is a next generation solution that blends the
flexibility and simplicity of traditional target date funds with
the security of guaranteed lifetime income.2 Available for defined
contribution plans, this solution represents a multi-year,
cross-industry development, resulting in a new kind of retirement
income strategy.
The enhancement, known as Deferred Lifetime Income at UC, was
introduced to the university’s target date fund, Pathway, in August
2021.
“The University of California has been researching how best to
evolve our Retirement Savings Program to help participants save
during their working years and live long comfortable lives in
retirement,” said University of California Chief Investment Officer
Jagdeep Singh Bachher. “People are living longer, with smaller
pensions due to shorter job tenures. Given market volatility,
there’s now a strong need for a supplemental source of guaranteed
income in the later years of life. Deferred Lifetime Income is an
innovative solution and an important step toward improving
retirement security for our participants.”
Leveraging insights gleaned from State Street’s 25-plus years of
managing target date strategies, IncomeWise™ focuses on providing a
simple investment option to support participants through all their
retirement years. The solution uses State Street’s target date
glidepath to help participants accumulate wealth during their
savings years. A portion of these savings can then be converted
into a guaranteed income stream for later years of retirement by
purchasing a qualified longevity annuity contract (QLAC). This
approach offers participants income security when they are likely
to need it most, while providing flexibility and access to savings
during their early retirement years.
“We are proud to partner with the University of California on
its journey to improve retirement security, and also to work across
the industry to build the framework that will further empower
participants and plans in managing the retirement transition,” said
David Ireland, global head of defined contribution at State Street
Global Advisors. “We are excited by the opportunity IncomeWise™
offers retirees at UC and elsewhere.”
The launch at UC reflects collaboration and innovation with a
leading plan sponsor, record keeper and insurance provider. State
Street has worked in partnership with Fidelity to implement
Deferred Lifetime Income as a custom solution on behalf of the
University of California. Additionally, State Street conducted a
thorough vetting process of insurance providers, culminating in the
selection of Metropolitan Tower Life Insurance Company (“MetLife”)
as the annuity provider for the 2021 annuitization.
“A predictable and lasting source of retirement income should be
the outcome of any qualified retirement plan, ensuring that
retirees have a solid foundation for their future,” said Graham
Cox, MetLife’s executive vice president and head of Retirement
& Income Solutions. “MetLife has been a leader and innovator in
the retirement income space for more than 40 years and we are happy
to be working with State Street to bring this unique solution to
market for UC Retirement Savings Program participants.”
About State Street Global Advisors
For four decades, State Street Global Advisors has served the
world’s governments, institutions and financial advisors. With a
rigorous, risk-aware approach built on research, analysis and
market-tested experience, we build from a breadth of active and
index strategies to create cost-effective solutions. As stewards,
we help portfolio companies see that what is fair for people and
sustainable for the planet can deliver long-term performance. And,
as pioneers in index, ETF, and ESG investing, we are always
inventing new ways to invest. As a result, we have become the
world’s third-largest asset manager with US $3.9 trillion* under
our care.
*This figure is presented as of September 30, 2021 and includes
approximately $60 billion of assets with respect to SPDR® products
for which State Street Global Advisors Funds Distributors, LLC
(SSGA FD) acts solely as the marketing agent. SSGA FD and State
Street Global Advisors are affiliated.
About the UC Retirement Savings Program
The UC Retirement Savings Program is the defined contribution
program of the University of California consisting of the 403(b),
457(b) and 401(a) plans with assets of $34.6 billion serving over
300,000 participants.
About MetLife
MetLife, Inc. (NYSE: MET), through its subsidiaries and
affiliates (“MetLife”), is one of the world’s leading financial
services companies, providing insurance, annuities, employee
benefits and asset management to help its individual and
institutional customers navigate their changing world. Founded in
1868, MetLife has operations in more than 40 markets globally and
holds leading positions in the United States, Japan, Latin America,
Asia, Europe, and the Middle East.
Important Risk Information
All forms of investments carry risks, including the risk of
losing all of the invested amount. Such activities may not be
suitable for everyone.
The information provided does not constitute investment advice
and it should not be relied on as such.
© 2021 State Street Corporation - All Rights Reserved
3858979.1.1.GBL.RTL
1 Source: UC Regents, as of June 30, 2021. 2 Payment of the
lifetime income is subject to the claims-paying ability of the
issuing insurance company; it is possible that the issuing company
may not be able to honor the income payouts at any time. Neither
IncomeWise nor the Deferred Lifetime Income feature are insured by
the FDIC or by another governmental agency; they are not
obligations of the FDIC or deposits or obligations guaranteed by
State Street Global Advisors. The Deferred Lifetime Income feature
is not provided by or guaranteed by State Street Global Advisors or
any affiliate of State Street Global Advisors.
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