Nationwide adds Income America in-plan guarantee for managed account participants
Columbus, OH - According to a 2022 Nationwide Retirement Institute® survey, seven in 10 plan sponsors are interested in guaranteed lifetime income investment options and nearly half (48%) of participants report they are interested in contributing to one as part of a managed account. Nationwide is seeing this interest translate to greater traction for its suite of in-plan guarantee solutions, announcing today that it has made Income AmericaTM 5ForLife available for managed account programs on its platform.
Nationwide continues to believe that in-plan guarantees are not a one-size-fits-all solution. Now the company provides two ways for plan sponsors and participants to access Income America 5ForLife, a series of bank-maintained collective investment funds for which Wilmington Trust, N.A. is trustee.
Income America 5ForLife in Managed Accounts: Starting this month, Income America is available as an investment option to the managed account programs on the Nationwide platform, starting with Nationwide ProAccount®. This provides a great new solution for the “do-it-for-me” investor that wants advice on how to invest their retirement plan assets, but needs help in determining an appropriate allocation to a guaranteed lifetime income investment option.
Income America 5Forlife Target Date Series: The Income America 5ForLife Target Date Fund Series that launched in 2021 continues to be available. Participants can contribute to or transfer assets into one of these funds, which are a great option for plans and participants looking for a simplified “help-me-do-it” solution built into a target date fund. According to Nationwide’s 2022 survey, more than half of participants are interested in guaranteed lifetime income investment options as part of a target date fund.
“When the SECURE Act of 2019 opened the door for the expansion of in-plan guarantee solutions, we were among the first to market with a suite of products to help participants protect their assets and convert their savings to income in retirement,” said Eric Stevenson, president of Nationwide Retirement Solutions. “Since then, we have been helping plan sponsors, financial professionals and consultants understand how protected retirement solutions like in-plan guarantees may be a fit for participants’ needs. These efforts are really starting to pay off with the traction in adoption starting to occur.”
Nationwide’s 11-year in-plan guarantee journey
Nationwide has been in the in-plan guarantee market as an insurer for over 11 years. In 2021, the company began introducing a suite of income solutions available through the company as a recordkeeper. Today, the company manages $1.4 billion in-plan guarantee assets for more than 5,500 plans.
Nationwide is growing adoption of these solutions by:
- Delivering participant education through enrollment and ongoing touchpoints
- Offering investment advice through Nationwide’s managed account solution, ProAccount
- Working with plans to set the solution as a default investment (QDIA)
Interest in in-plan guarantees continues to grow
“The recent economic environment has driven greater interest in solutions that offer protection in retirement – whether that’s providing downside protection or helping ensure participants can turn their savings into a stream of income they won’t outlive,” Stevenson said.
According to Nationwide’s 2022 survey, more than four in 10 employees (41%) would likely roll over retirement savings into a guaranteed lifetime income investment option if they were able to. Plan sponsors reported high levels of favorability (75% private sector and 86% government) and comfort (64% private sector and 73% government) with the addition of guaranteed lifetime income investment options within employer-sponsored retirement plans.
Nationwide Retirement Solutions administers nearly 32,000 retirement plans, protecting more than $165 billion in participant assets as of Dec. 31, 2022, and helping secure financial futures for over 2.7 million participants in the governmental 457, corporate 401(k) and not-for-profit 403(b) markets. Nationwide is committed to serving the retirement industry by doing the right thing at the right time through better participant experiences, administrative simplicity and values that translate to service.
Nationwide, a Fortune 100 company based in Columbus, Ohio, is one of the largest and strongest diversified insurance and financial services organizations in the United States. Nationwide is rated A+ by both A.M. Best and Standard & Poor’s. An industry leader in driving customer-focused innovation, Nationwide provides a full range of insurance and financial services products including auto, business, homeowners, farm and life insurance; public and private sector retirement plans, annuities, mutual funds and ETFs; excess & surplus, specialty and surety; pet, motorcycle and boat insurance. For more information, visit www.nationwide.com. Follow us on Facebook and Twitter.
About Income America
Several industry leaders—including American Century Investments, Lincoln Financial Group, Nationwide, SS&C Technologies, Wilmington Trust, N.A., and Wilshire—came together to create a revolutionary retirement solution: Income America 5ForLife, a series of target date portfolios that provide guaranteed lifetime income. Designed to help retirement plan participants save for a more secure future, Income America 5ForLife is an innovative, unbiased, multi-insured, in-plan retirement income solution. With Income America 5ForLife, participants can contribute through convenient payroll deductions while they're working and enjoy protection against market uncertainty during retirement.
Important information: Guarantees are subject to the claims-paying ability of the issuing companies. The income guarantee is based on the income base at age 65, which is set to the greater of the participant’s market value or their contributions (less withdrawals) to date. The market value of the account is never guaranteed and fluctuates based on investment performance. While participants can withdraw the market value of their account at any time without any fees or penalties, doing so will cause them to lose the income guarantee. The income base is never available for withdrawal, but is only used for calculating income. Participants will be able to elect to receive income any time after age 65.
Product disclosures: The Income America Funds are Wilmington Trust, N.A. Collective Investment Funds (“WTNA Funds”), which are bank collective investment funds; they are not mutual funds. Wilmington Trust, N.A. serves as the Trustee of the Wilmington Trust Collective Investment Trust and maintains ultimate fiduciary authority over the management of, and investments made in, the WTNA Funds. The WTNA Funds and units therein are exempt from registration under the Securities Act of 1933, as amended, and the Investment Company Act of 1940, as amended. Investments in the WTNA Funds are not deposits or obligations of or guaranteed by Wilmington Trust, and are not insured by the FDIC, the Federal Reserve, or any other governmental agency. The WTNA Funds are commingled investment vehicles, and as such, the values of the underlying investments will rise and fall according to market activity; it is possible to lose money by investing in the WTNA Funds.
Participation in Collective Investment Trust Funds is limited primarily to qualified defined contribution plans and certain state or local government plans and is not available to IRAs, health and welfare plans, and certain Keogh plans. Collective Investment Trust Funds may be suitable investments for participants seeking to construct a well-diversified retirement savings program. Investors should consider the investment objectives, risks, charges and expenses of any pooled investment company carefully before investing. The Additional Fund Information and Principal Risk Definitions (PRD) contain this and other information about a Collective Investment Trust Fund and is available at www.wilmingtontrust.com/PrincipalRiskDefinitions or ask for a copy by contacting Wilmington Trust, N.A. at (866) 427-6885.
The Income America 5ForLife target date portfolios include a group annuity contract, which provides a plan participant with guaranteed annual retirement income that is supported by a contract between the trustee and the following issuing insurance companies:
- The Lincoln National Life Insurance Company, Fort Wayne, IN. The Lincoln National Life Insurance Company does not solicit business in the state of New York, nor is it authorized to do so. Lincoln Financial Group is the marketing name for Lincoln National Corporation and its affiliates.
- Nationwide Life Insurance Company, Columbus, OH.
All entities listed within this document are separate and nonaffiliated companies.
These investment options may not be available in all states.
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