2019 Agendas: Retirement Income

As managing director for institutional financial services at TIAA, Mark Foley frequently speaks with plan sponsor clients about their evolving goals and expectations in offering defined contribution (DC) retirement benefits to employees.

Like other executives working at both established and up-and-coming recordkeepers, Foley says 2018 was a big year, for both his firm and its clients—and for the broader retirement services industry.

“Especially from my perspective being in charge of default solutions, it [was] a very busy year in terms of working with plan sponsors on improving their plans and creating innovative solutions to long-standing challenges,” Foley says. “We have been doing a lot of work to continue to enhance and broaden the use of custom approaches to default offerings, and we’re pleased with the steps our clients are taking to address participant outcomes.”

According to Foley, clients increasingly ask for help to address lifetime income within the DC plan context.

“This is another very positive development we saw in 2018,” he says. “When we can get lifetime income solutions linked up with the default options in a plan, we know this can be a powerful combination for improving participant outcomes and confidence about retirement.”

Foley says the lifetime income conversation among DC plan sponsors “is really ramping up,” but one of the persistent challenges is being able to actually operationalize this type of a solution.

“I joined TIAA from Prudential, and when I was there I was directly involved in its plan-linked lifetime income products,” he notes. “So, I can say I’ve been in the trenches on this issue for some time. My assessment is that the industry is only now getting to the point where we can offer this type of solution in a pretty straightforward way. We can make it relatively simple for the participants and the sponsors.”

Whether talking about clients using customized solutions or those going with prepackaged default products, Foley says conversations about fee transparency also remain front and center in the face of the new year.