Hybrid 401(k)s that Include Annuities Slow to Gain Market Traction

Barclays and other large asset managers roll-out sophisticated defined contribution plans that have annuity options built into the plans.  Employers, however, have been slow to adopt the new programs.

If you're approaching retirement right now, there's no easy fix for your portfolio. But if you are in midcareer, you may soon have a chance to structure your 401(k) in a much different way. A dozen or so asset managers and insurers, including AllianceBernstein, AXA, Barclays Global Investors, John Hancock, MetLife, and Prudential, are designing a new breed of retirement instrument that combines elements of pensions and 401(k)s. These products—call them hybrid 401(k)s—have begun slowly rolling out. And while they differ in structure, all combine annuities—essentially, insurance contracts that provide periodic income payments—with an investment portfolio.

Source: Business Week

Full Story

Key Phrases: