BlackRock Activates Retirement Solution Offering A Paycheck For Life

BlackRock (NYSE: BLK) announced today that its retirement income solution, LifePath Paycheck, is now available in defined contribution plans.

The LifePath Paycheck solution takes a new approach to retirement income by providing access to guaranteed income through a target date fund, an investment strategy that automatically adjusts to a targeted retirement year. Plan participants will have the option to access the guaranteed income as early as age 59 ½ by purchasing annuity contracts issued by Equitable (NYSE: EQH) and Brighthouse Financial (NASDAQ: BHF).

To help educate plan participants, BlackRock developed MyLifePath, a digital experience that shows how today's contributions can translate into income in retirement.

Avangrid (NYSE: AGR), Adventist HealthCare Retirement Plans, and Tennessee Valley Authority Retirement System will be among the first to implement the strategy as the default investment option for their employees’ defined contribution plan, with additional plan sponsors to follow in the coming months. To date, 14 plan sponsors, with plans totaling $27 billion in target date assets, are planning to make LifePath Paycheck available to 500,000 employees, with several other large plan sponsors expressing interest.

Larry Fink, Chairman and CEO of BlackRock, said, “We believe LifePath Paycheck will one day be the default retirement investment strategy, providing access to a predictable, paycheck-like income stream that can help improve the quality of life for millions of Americans in retirement.”

Anne Ackerley, Head of Retirement at BlackRock, added, “A top concern among American workers is the fear of running out of money during retirement. And yet the industry has focused on helping people understand they need to save – but not how to manage spending in retirement, even as companies have shifted from defined benefit to defined contribution plans. With this solution, we’re rethinking retirement. And part of that was working across the industry to build something new.”

Access to an option for guaranteed income could help alleviate the stress many Americans currently face about the uncertainty of outliving their savings. According to early findings from BlackRock’s ninth annual Read on Retirement survey,¹ nearly two-thirds (60%) of those surveyed² worry they’ll outlive their retirement savings and 99% say having guaranteed retirement income would help ease that concern. Beyond financial benefits, 93% ¹ say having more certainty around retirement income would help their mental health today.