T. Rowe Price Develops New Framework for Defined Contribution Plan Sponsors to Evaluate Retirement Income Solutions

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[{"type":"text","content":"Goal is to help plan sponsors assess the possibilities in a more strategic and informed way\n\n\nBALTIMORE, June 1, 2021 /PRNewswire/ -- T. Rowe Price (NASDAQ-GS: TROW) has developed a new framework to help plan sponsors of defined contribution (DC) plans assess retirement income solutions for participants to address the evolving needs of retirees. The evaluation framework aims to enable plan sponsors to adapt their DC plans to account for the full retirement lifecycle – including those participants who are already in retirement. \nT. Rowe Price research shows that retirement income is at the top of the list for plan sponsors when discussing recovery from the \"pandemic pause\" of 2020. Conversely, there is relatively slow progress in bringing retirement income solutions to DC plans. In November 2020—nearly a year after the passage of the SECURE Act–61% of plan sponsors reported that the Act failed to motivate them to consider retirement income solutions. Still, plan sponsors recognize the need to help their participants as they move into retirement, which is the primary motivator (59.4%)1 to develop retirement income solutions cited by sponsors in a recent T. Rowe study. \n\"The retirement income pursuit is a complex issue for plan sponsors and participants, and our objective is to help with progress.\" says Lorie Latham, Senior Defined Contribution Strategist. \"To date, the retirement industry has tended to lead with launching retirement income products and with an aim to \"sell\" into plans. We hope to see a pivot toward greater emphasis on the fundamental needs of retirees and plan objectives. You need to gain a clear understanding of what you are hoping to address before looking at the end solution.\" \nProviding retirees with a suite of income solutions, or \"retirement tier\" is widely agreed to be the preferred solution to addressing the range of retiree needs. T. Rowe Price research shows 94% of DC consultants agreed that a suite of income solutions is preferred to a single retirement income offering. However, DC consultants also report that only 13% of their plan sponsor clients currently provide, or are planning to provide, a retirement tier2. T. Rowe Price's new framework aims to bridge this gap by offering plan sponsors a strategic and informed evaluation process. \nThe framework is designed to help the assessment ...

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