Guaranteed in-plan lifetime income solutions is a hot topic in the workplace retirement market these days, and we wanted to hear from one of the foremost experts on these products in “Annuity Yoda” Tamiko Toland.
After stints at TIAA and CANNEX, the thought leader in annuities in retirement plans in the individual and institutional markets last year started Toland Consulting, LLC, to share her insights, experience, and strategic analysis with clients, and she’ll also tell us about a couple of other new gigs keeping her busy these days—all with a focus on helping to educate people about lifetime income solutions.
SEE ALSO:
• What to Consider When Contemplating an Annuity for a Defined Contribution Plan
Click to read the audio transcript here.
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Brian Anderson: This is 401k Specialist Editor in Chief Brian Anderson and this is the 401k specialist podcast. Today we’re very happy to have one of the foremost experts when it comes to annuities and their place as in plan guaranteed income solutions within workplace retirement plans in Tamiko Toland. Tamiko has spent more than two decades Tracking trends and key issues on retirement income in that time, becoming a thought leader and a very in demand speaker on the topic of retirement and annuities in the individual and institutional markets.
She recently started Tolan Consulting LLC to share her insights, experience and strategic analysis with clients. And she’s very passionate about helping people gain a better understanding of often complex annuity products. Prior to starting her consulting business last year, she served as Managing Director, Head of Lifetime Income Strategy and Market Intelligence within the Product and Business Development area at TIAA, and before that was Director of Retirement Markets for CANNEX, where she spearheaded business development in the 401k space and was responsible for research and thought leadership on annuities in retirement plans.
Today, we get to hear what’s on her mind on a variety of retirement, income related topics, which is obviously a hot button issue in the workplace retirement plan, world this year. So welcome to the 401k specialist podcast, Tamiko.
Tamiko Toland: Thank you so much. Super excited to be here talking about my favorite topic.
Brian Anderson: All right. Well, we’re here at the start of a new year and I’m here with the annuity Yoda. So, it seems like a good place to start.
Is 2024 going to be the year for lifetime income and workplace retirement plans?
Tamiko Toland: So, a lot of us that have been around for a while have heard that pretty much every year, and I think it’s going to be a good year, but it’s not necessarily going to be the avalanche year that I think many of us had sort of hoped for and have now gotten more, a little more realistic about.
Brian Anderson: Way back in 2012, way ahead of the curve, you published a detailed report on in plan guarantees that identified trends and opportunities in an evolving marketplace. It is certainly evolved plenty since then, but I’m wondering if you can share what are some of the key differences within the industry today compared to when you originally published that report?
Tamiko Toland: So, I think a lot of the changes have actually been somewhat invisible. a lot of it’s really structural, our ability to. You know, operationally support the inclusion of annuities. So that is really a big deal, as well as the fact that it’s quite clear now that target dates are driving the bus for 401ks.
Whether it’s, you know, actual CITs or managed account based structures, we’re still seeing a tremendous evolution for the delivery of any target date solution. It’s really very exciting because this enables more different ways to offer an annuity for planned participants and particularly as a default, which, you know, I have a lot of thoughts about.
I know this is a little bit of a controversial topic, but anyway.
Brian Anderson: All right. defaults with lifetime income.
Tamiko Toland: Yeah, absolutely. So, the thing is that when people are told, make a decision about an annuity on your own, they typically don’t do that. really the adoption of annuities in retirement plans when it’s completely up to the participant is low.
And the problem with that is that. A lot of plant sponsors really want to protect their participants. It’s one of the reasons they put other defaults in place. And this is just one of those things that if we want actual protection of lifetime income for those participants, it’s just got to be part of the default.
Now, how that manifests is different with different solutions. So, this is not a one size fits all. Even Under the umbrella of defaulting itself.
Brian Anderson: Hey, there’s been a lot of buzz around managed accounts lately. Can you tell us about the need for retirement plan advisors to adopt useful vocabulary to talk about managed accounts and retirement plans?
Tamiko Toland: Yeah. So, this is something that I noticed, when I was at TIAA and the way that we talked about things like custom target date and what does that actually mean? How do people perceive that? And from. The TIAA Perspective. you know, there was really effective implementation using very low cost managed account.
So, the reality is that that’s not necessarily sort of in the standard lexicon when people think about traditional managed accounts. And I could see that that was becoming a little bit of like a communications challenge. like what are people, what do people have in mind when they think about customization, personalization?
Is it a record keeper driven managed account model solution? Is it advisor managed accounts? So, we tend to use one. term managed accounts. And we describe an entire spectrum of delivery and people haven’t really, reconciled what all those things mean and what it is that someone is offering. So, I think that that’s really adding a lot of confusion to the conversation because that is a, you know, common way of integrating lifetime income.
Brian Anderson: Right. Okay. Let’s talk for a minute about the role of education. There’s still a lot of work to be done to help people understand what guaranteed in plan solutions are, how they work, how they can help people build a secure retirement. What are some of the key challenges you see right now in terms of education?
Tamiko Toland: So I really feel like we’re still in the early days for a lot of folks, who are looking at lifetime income solutions. They need to understand what they are. They need to understand how they fit within a plan? And what are those fiduciary considerations? So, you know, I think that there’s a ton of work just with basic education to help different plan fiduciaries with their sponsors, advisors, consultants, become more comfortable with how they see the marketplace and how they integrate these concepts, within their existing methods for making selections and monitoring really, any, investment within the plan.
Brian Anderson: Well, let’s switch gears a little bit here and talk about what you’re up to these days. in addition to your relatively new consulting practice, I understand you were also in the process of launching another new initiative called the 401k annuity hub.
So why did you decide to launch a market intelligence service for the space?
Tamiko Toland: Yeah. So, the funny thing is that, you know, I really come from the data space, market intelligence, competitive intelligence. And when I started going off on my own and thinking about what are the best ways of bringing education out there, I realized that we lack a centralized source of just basic market data on the solutions out there, particularly through the lens of the fiduciaries and myself being more from the product area.
I always broke things down as products and through that annuity lens. And I’m really coming to appreciate that we need to approach it differently. So, this has been really the evolution of my own thinking, reflected in how should we collect the information and then reshare it. To really help with education and with adoption.
Brian Anderson: And I also hear that’s not the only new thing you’re up to right now. I also want to congratulate you on assuming a committee leadership role with the defined contribution institutional investment association. That’s a mouthful right there. tell us about why you’re excited to [00:08:00] be taking this one on.
Tamiko Toland: Well, thanks so much for bringing that up. I’m really excited, to be part of the leadership committee for the retirement income committee of DCIA. And I. It’s so important to me because I really feel like to see, has taken a role front and center and helping with education, helping tackle the challenges that everybody is facing when it comes to all retirement income solutions.
Obviously, I’m focused specifically on lifetime income, which is, you know, those, solutions that use an annuity in some way. But I’m very excited to be a part of that and to help spread the message and work together with a great group of folks, just to push things forward for all of us.
Brian Anderson: Okay. Well, Tamiko Toland, this has been great. Thank you so much for sharing all your insights today about annuities in retirement plans on the 401k Specialist Podcast.
Tamiko Toland: Thank you.
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.
