BlackRock Prepares LifePath Paycheck to Address In-Plan Retirement Income

BlackRock announced the official launch of LifePath Paycheck, a retirement income solution designed to function like a target-date fund, embedding the option to annuitize a portion of a participant’s assets starting at age 55.

“Even though we’re not an insurance company, we [feel] that people generally need some sort of guaranteed income,” Anne Ackerley, head of the retirement group at BlackRock, said at a press briefing Wednesday. “But with all the issues that there are with annuities, we said, ‘Let’s see if we can innovate. Can we make them liquid? Can we make them institutionally priced? Can we make them simple?’”

To date, 14 plan sponsors, representing more than $27 billion in target-date assets and more than 500,000 participants, have elected to work with BlackRock to implement LifePath Paycheck as the default investment option in their employees’ retirement plans. The implementation of the solution in these plans is set to occur in the coming months, according to Ackerley.

Ackerley said the product is nearing completion, and companies are now notifying their participants, as they are required to give at least 30 days notice when there is a change to the qualified default investment alternative.

Rob Crothers, head of product and strategy at BlackRock’s retirement group, explained that LifePath Paycheck is designed to deliver an “index target-date-fund-like return,” regardless of whether the participant wants to purchase a lifetime income stream.

“That means for most of [a participant’s] working life, from, say, age 22 all the way to age 55, [LifePath Paycheck] looks and feels exactly the same as our existing index target-date fund does—that’s traditional stocks and bonds, [and] it de-risks over time as you get closer and closer to that retirement at age 55,” Crothers said.

Nationwide Launches Retirement Income Dynamic Default Feature

Nationwide announced it will allow plan sponsors to automatically default participants into a protected retirement solution with an annuity through what it calls a Dynamic Default; employers will be able to select multiple default investment options based on age.

As of the end of the first quarter of 2024, 6,931 plans offered in-plan protected retirement solutions supported by Nationwide with $4.95 billion in assets under management for 64,372 participants who have adopted a protected retirement investment solution. The figures are up from 1,042 plans, $1.14 billion in AUM and 52,314 participants in 2023.

“We’re really starting to see a lot more employers become more comfortable offering protected retirement solutions, and we believe offering them through dynamic default will be the next generation of retirement plan auto features,” Eric Stevenson, president of Nationwide Retirement Solutions, said in a statement.

In 2020, Nationwide launched a suite of in-plan protected retirement solutions to help employer-sponsored retirement plan participants convert their savings into protected income they won’t outlive in retirement.

“Employers are recognizing that their participants want and need help translating their savings into retirement security,” Stevenson said in a statement“The key is not just making these solutions available, but making them automatic for employees who don’t know where to start. Auto features for enrollment and escalation of contributions have been tremendously successful in driving greater retirement preparedness across the industry. Our Dynamic Default feature will build on this success to support even greater retirement security for plan participants.”

CAPTRUST Selects CAIS to Streamline Alternative Investments

CAIS, an alternative investment platform for independent financial advisers, announced it will partner with CAPTRUST, one of the nation’s largest financial advisory firms with more than $800 billion in client assets under advisement. CAPTRUST advisers will leverage CAIS’ SaaS technology to consolidate their alternative investment products and processes onto a single platform, creating an “enhanced, unified alts experience,” according to the firms.

“We are thrilled to work with CAIS to offer our advisors best-in-class technology enhanced by a dedicated advisor-facing team of professionals to streamline their alternative investing experience,” said Michael J. Vogelzang, managing director and chief investment officer at CAPTRUST, in a press release. “Working with CAIS will play a critical role in eliminating the operational burdens typically associated with investing in alternatives and creating a more streamlined and scalable solution for our clients.”

The SaaS technology, CAIS Solutions, enables independent financial advisers to centralize their fund positions through automated processes across the entire alternative investment lifecycle.

CAPTRUST’s advisers will also have access to integrated adviser education via CAIS IQ, expanded support for structured investments, and dedicated coverage through CAIS’ more than 70 adviser-facing professionals. The CAIS platform will also provide “seamless integrations” into CAPTRUST’s custodians and reporting providers, including BNY Mellon’s Pershing, Fidelity Investments, Charles Schwab and Black Diamond, for more efficient data management and reporting.

The announcement comes shortly after Baird, an international wealth and asset management firm, expanded its relationship with CAIS to consolidate all its alternative investment products and processes onto a single platform.

FIDX Launches Outsourced Insurance Desk to Help RIAs Incorporate Annuity Solutions

Fiduciary Exchange LLC (FIDX) and its broker dealer, FIDX Markets, announced the launch of FIDX Desk, a new outsources insurance desk, which will enable registered investment advisers and fee-based financial professionals to “effortlessly integrate annuity products into their offerings, regardless of their insurance licensing status.”

FIDX Desk aims to tackle obstacles that RIAs face, enabling them to present the potential advantages of annuity solutions—such as income and legacy planning—to their clients.

In addition, FIDX Desk will help RIAs manage investments in annuities that were previously purchased through former broker dealers. There is no additional fee to financial professionals who use FIDX Desk, according to apress release.

Financial professionals are able to research annuity products, oversee the application process and advise on a client’s annuity all on one platform. Clients will also have access to a wide array of annuity products from “some of the most well-known insurers in the industry.”

Vontobel Launches International Equity Fund

Vontobel Asset Management Inc. launched its international equity fund as part of a new series of mutual funds, investing in companies primarily domiciled outside the U.S. in both developed and emerging markets.

The fund seeks to invest long-term in companies with stable, predictable and sustainable earnings growth. The fund officially launched with client backing of $146 million as of April 22.

“The impressive 33-year track record of our Quality Growth International Equity Strategy underscores our commitment to consistently providing clients with strong, risk-adjusted returns over the long term,” said Matthew Benkendorf, chief investment officer of Vontobel’s quality growth team, in a press release. “We look forward to expanding the reach of our investment strategy at industry-competitive fees to serve US investors looking for high-quality international exposure.”

Vontobel is also working toward launching additional mutual funds this year, including one based on its global equity strategy. The firm has selected SEI to provide the infrastructure to power the network and new products.