Considerable resources have been devoted to solving the challenge of portability in retirement savings over the past few years, and the stakes are high to get it right and cut down on costly and unnecessary retirement plan leakage.
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In this episode, we talk with Ben Thomason, Head of Defined Contribution Distribution at Allianz Life Insurance Company of North America, to explore the importance of portability and the unique challenges it poses when it comes to in-plan guaranteed lifetime income solutions.
Thomason dives into the complexities of why portability matters for participants, preserving benefits, maintaining guarantees, and navigating the challenges of transferring retirement assets across plans and IRAs. He also talks about key factors advisors need to consider when assessing different in-plan guaranteed lifetime income options.
Key Insights:
Here are three concise key insights from the podcast episode:
- Technology’s Role in Portability: Middleware technology is vital for maintaining seamless connectivity between record keepers and product providers, enabling easier portability of guaranteed lifetime income products and ensuring a consistent participant experience during transitions.
- Importance of Portability: Portability of retirement savings is crucial as workers frequently change jobs. In-plan guaranteed lifetime income solutions, such as annuities, need to ensure participants can transfer their benefits seamlessly without losing guarantees or facing disruptions.
- Product Design and Portability: Products designed as individual contracts offer significant advantages in portability over group contracts, as they maintain consistent benefits and guarantees when moved between plans, reducing administrative complexity and costs.
Research cited in this podcast:
- Allianz Life conducted an online survey, the 2024 3Q Quarterly Market Perceptions Study, in August 2024 with a nationally representative sample of 1,005 individuals age 18+.
- U.S. Bureau of Labor Statistics, January 2022
- Trends in Public-Sector Employee Tenure, 2000-2022, Public Retirement Research Lab, 2022
Allianz Life Insurance Company of North America has been keeping its promises since 1896 by helping Americans achieve their retirement income and protection goals with a variety of annuity and life insurance products.
Allianz Life Insurance Company of North America does not provide financial planning services.
Allianz Life Insurance Company of North America is not affiliated with 401(k) Specialist
Guarantees are backed solely by the financial strength and claims-paying ability of the issuing insurance company.
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.
