Wealth Management

Income Solutions for Retirement Accumulation & Decumulation

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Jared F. Baucom

Jared F. Baucom

Managing Director, Global Sales & Marketing

Retirement Regulation and Implications for Rollovers: Will Annuities Compete with Rollover Plans?

With new legislation proposed through the SECURE Act, wealth managers may need to consider other income-providing solutions for retirees. How will this impact rollovers and how should wealth managers prepare?​

The DC industry has grappled with the subject of retirement income for years, and participants stand to benefit from more comprehensive support as they transition from the accumulation of retirement assets to decumulation. Recent legislation may encourage the adoption of annuities in corporate DC plans—introducing a competitor to traditional income solutions in DC plans.

For wealth managers, this means they can no longer count on capturing rollovers being their clients’ retirement income solution. As providers enhance their product offerings and as recordkeepers invest in technology, DC plans are evolving—slowly but surely—to allow for more flexible and automated distributions from participant accounts.

Retirement Specialist Advisors: Preferred In-Plan Retirement Income Solutions, 2018 vs. 2020

Source: Cerulli Associates, in partnership with the Investments & Wealth Institute and the Financial Planning Association® (FPA®)

Key Implication:

The DC industry has grappled with the subject of retirement income for years, and participants stand to benefit from more comprehensive support as they transition from the accumulation of retirement assets to decumulation (e.g., through personalized guidance and suitable investment options). Recent legislation may encourage the adoption of annuities in corporate DC plans; however, these products carry a negative stigma for many investors. Moreover, advisors who don’t already sell annuities may be reticent to explore the topic and adapt their DC service models. In the meantime, plans are more likely to offer managed accounts or a target-date fund with an income vintage as a retirement income solution. As providers enhance their product offerings and as recordkeepers invest in technology, DC plans are evolving—slowly but surely—to allow for more flexible and automated distributions from participant accounts.

Does your firm have what it take to service retirement assets? 

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Retirement

Subject Matter Experts

Bing Waldert

Bing Waldert

Managing Director, U.S. Research

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Bing Waldert

Bing Waldert

Managing Director, U.S. Research

Bing Waldert leads Cerulli’s U.S. Research team comprising seven research practices that cover all elements of the U.S. asset management, wealth management, and retirement markets. He has authored Cerulli reports on the wealth management industry, high-net-worth market, the annuity industry, and retirement markets. He is a frequent board-level and C-suite speaker and well-regarded industry thought leader. He has spoken in front of the Investment Company Institute (ICI), the Asset Management Association of China (AMAC), the Investments and Wealth Institute (IWI), and the Money Management Institute (MMI).

He has worked on client projects on emerging manager expansion strategies, independent registered investment advisors (RIAs), multi-family offices (MFOs), investment platforms, and the outsourced chief investment officer (OCIO) industry. In addition, he has advised multiple private equity firms on acquisitions in the wealth management space.

Full biography here.

Shawn O'Brien, CFA

Shawn O'Brien, CFA

Senior Analyst

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Shawn O'Brien, CFA

Shawn O'Brien, CFA

Senior Analyst

As a senior analyst, Shawn is responsible for covering the retirement markets space, focusing specifically on defined contribution (DC) plans, the IRA market, and asset managers’ DCIO strategies. He contributes to The Cerulli Report and The Cerulli Edge series.

Prior to joining Cerulli Associates, Shawn worked as a Research Associate at Harvard Business School, where he co-authored case studies alongside professors focusing on investment management for individual and institutional investors, and innovations in financial technology. Prior to that, he worked in the Currency Management group at State Street Global Markets, employing currency overlay strategies for large asset managers and asset owners.

Full biography here.

Anna Fang

Anna Fang

Senior Analyst

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Anna Fang

Anna Fang

Senior Analyst

Anna specializes in U.S. retirement market trends with a focus on defined contribution (DC) plans and individual retirement accounts (IRAs), including coverage of 401(k) plan sponsors and plan participants. She is a member of the Retirement practice, where she leads development of Cerulli’s Retirement Lodestar, a web-based interactive business development platform; and quantitative models to forecast market growth. She also contributes to The Cerulli Edge series and provides qualitative and quantitative analysis to support strategic consulting engagements.

Prior to joining Cerulli Associates, Anna was at Wellesley Investment Advisors. In her role, she complied and organized client reports and marketing materials for financial advisors.

Full biography here.

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