December marked the one-year anniversary of the passage of the SECURE Act, which is expected to be a gamechanger in the institutional income annuity landscape. It has made it easier for plan sponsors to offer annuities in defined contribution plans. In fact, interest was high among employers who were awaiting clarification on the annuity carrier selection safe harbor. According to MetLife’s Evolving Retirement Model Study, eight in 10 employers indicated they were likely to offer a guaranteed income option within five years of the clarification being issued.
Unfortunately, shortly after the passage of the SECURE Act, plan sponsors’ and employers’ priorities understandably shifted to focus on the overwhelming and pressing impacts of COVID-19. Now employers are grappling with the effects of the pandemic, but there are already lessons to be learned from the experience, particularly as it relates to retirement income needs.
