In the ever-evolving world of retirement income programs, successful implementation and widespread adoption hinge on one crucial element: collaboration. With a complex web of stakeholders involved, from recordkeepers to middleware technology providers, understanding how these parties work together is essential. Without close collaboration across all stakeholders, it will be difficult to create a retirement income program that is integrated in such a way that plan sponsors and participants can adopt and benefit from it.
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When a recordkeeper creates a retirement income program, they typically gather feedback from participants, plan sponsors, advisors and consultants to help determine which solutions best meet the needs of their clients. Recordkeepers will then collaborate with retirement income solution providers to determine how to best integrate these solutions into their 401(k) platforms and participant experience.
But the collaboration doesn't stop there. Technologists from recordkeepers, retirement income middleware technology providers and solution providers must work in tandem.
Middleware technology acts as a bridge, connecting multiple retirement income solutions through a single interface. It provides essential services such as the calculation of guaranteed benefits, program oversight and the creation of participant experience microsites. Furthermore, it ensures that retirement income solutions are accessible across a network of connected recordkeepers, facilitating seamless distribution. Without middleware technology, integrating and adopting these solutions becomes a challenging feat.
Investment structures also play a pivotal role in retirement income solutions, and decisions regarding them require close collaboration. If a solution incorporates target-date funds (TDFs) or balanced funds within a collective investment trust (CIT) structure, a trust company’s involvement is necessary. Similarly, if the solution integrates with managed accounts or advice engines, connecting it to these technology platforms is crucial. The value of these solutions is fully realized only when all partners work closely together.
Participant and plan-level portability are now industry standards, especially for solutions with guaranteed benefits. Ensuring that participants retain their benefits even when changing jobs or recordkeepers is essential. Collaboration among recordkeepers, product providers and middleware technology providers has created networks that support this portability, fostering confidence among all stakeholders.
The retirement income landscape is evolving, and collaboration is at its core. By understanding the intricate interactions among stakeholders, we can appreciate the efforts involved in delivering effective retirement income solutions. As adoption grows, so too will the need for continued collaboration.
Stay tuned for our next post, in which we’ll delve into the industry organizations shaping the future of retirement income.
For more insights on how the industry is collaborating to expand the availability of retirement income solutions, watch the Broadcast Retirement Network "Video Q&A with Ryan Grosdidier, Retirement Income Solutions, SS&C Retirement Solutions" discussion with Jeff Snyder and SS&C Technologies.
