The Prudential Retirement unit of Prudential Financial Inc. has introduced a lifetime income guarantee for retirement plan participants who have assets in target-date funds.
The Prudential IncomeFlex Target feature integrates a guaranteed, lifetime income product with target-date funds, which are available as separate accounts under group variable annuity contracts. The group VAs are issued by Prudential Retirement Insurance and Annuity Company, Hartford, according to Prudential, Newark, N.J.
The feature is available for a fee, which is in addition to investment management charges, Prudential says.
To maintain the benefit, plan participants must invest in a Prudential IncomeFlex Target Fund.
Withdrawals in excess of the product’s “lifetime annual withdrawal amount” will reduce future guaranteed withdrawals proportionately, the company says. The participant does not have to annuitize in order to receive the guaranteed income.
The guarantee is based on the claims-paying ability of the issuing company.