retiree assets in the plan, they are evaluating what investment solutions are needed, as well as how to support the
communication or decisionmaking around retirement
income issues, says Stacy Schaus, defined contribution
practice leader at PIMCO.
“There’s increasing interest among plan sponsors in
retaining retiree assets in the plan, which necessitates
a close look at the appropriateness of the investment
lineup and consideration of retirement income solutions,”
Schaus says.
Here are five key areas industry experts suggest
advisers consider and discuss with clients when evaluating
retirement income options:
1 RECORDKEEPING. As with any investment selec- tion, when choosing a retirement income option, it is
crucial to select what is in the best interest of the participants and their beneficiaries. However, retirement income
options have some challenges because many recordkeeping
platforms do not offer the products. Presently, advisers
have a lot of influence driving recordkeepers to build their
programs so that they accommodate more retirement
income options, Lee says.
He suggests advisers talk to recordkeepers about how the
retirement income option will actually appear in the recordkeeping system and in statements.
When adding a retirement income product, the plan
adviser should work with the plan sponsor to gauge what
information about the investment should be conveyed to
participants. If the plan sponsor wants to provide more
detailed statements than is customary, then the adviser
and plan sponsor must determine whether the recordkeeper
can accommodate that need, says Craig Adamson, presi-
dent of Adamson Financial Planning. Advisers should make
sponsors aware of the potential for increased costs of more
detailed recordkeeping, he adds.
2 PORTABILITY FOR PARTICIPANTS. In addition to plan sponsors having portability to move recordkeepers, it
is important that participants have portability within their
