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September 16, 2011 at 08:00 PM
Maybe employees who are retiring should get a choice of retirement income product options.
Steve Vernon, a retirement consultant, makes that case in a commentary distributed by the Institutional Retirement Income Council (IRIC), Iselin, N.J.
IRIC is a group backed by Prudential Financial Inc., Newark, N.J. (NYSE:PRU), and other individuals and companies with an interest in retirement services.
Vernon notes that many employers already offer employees a wide variety of retirement savings choices through 401(k) plans and other defined contribution retirement plans.
Workers who are retiring now need a pre-set menu of options for converting their retirement accounts into streams of income, Vernon says.
Vernon says a typical menu could include a lump-sum rollover to the account of the retiree’s choice; immediate fixed, variable and inflation-adjusted annuities; a rollover into a mutual fund company’s managed payout fund, which would allocate assets to stocks and bonds; and a stream of installment payments from the plan itself, made either using a fixed dollar amount or a fixed percentage of the retiree’s account balance.
In other ideas news:
- Voluntary Benefits of America L.L.C., Nashville, Tenn., says it many employers and voluntary benefits enrollers will want to have employees enroll online.
