Lifetime Income Provisions Under the SECURE Act
The SECURE Act, which includes three major lifetime income-related provisions, represents a giant step forward on the part of Congress to not only reduce some of the barriers that have traditionally discouraged the use of lifetime income products by defined contribution plans, but to also encourage participants to begin thinking about their defined contribution savings in terms of a lifetime income stream.
Below, we describe and analyze each of the SECURE Act’s three lifetime income provisions. Respectively, those provisions require the delivery of lifetime income illustrations to plan participants, provide a fiduciary safe harbor for the prudent selection of lifetime income providers, and allow for the portability of lifetime income benefits that have been accumulated “in-plan” in connection with a change in providers.
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