Products May 9, 2024

Product and Service Launches

Empower providing retirement plan administration to Arizona city; TruStage enhances annuity; Confluence Technologies announces analytics partnership; and more.  

Reported by

Empower to Manage 457(b) Plan for Arizona Municipality First Responders

Empower announced it will provide retirement benefits to public service members at Mesa Fire and Medical, managing the City of Mesa Fire/Medical 457(b) Deferred Compensation Plan.

Empower will provide retirement plan administration to the plan’s more than 850 public service workers, according to a press release. The Mesa 457 plan holds approximately $88 million in retirement assets as of February 2024. Empower data shows.

For more stories like this, sign up for the PLANSPONSOR NEWSDash daily newsletter.

The contract begins July 1, 2024, with a five-year term and can be renewed for up to two years maximum.

“Firefighters put their lives at risk and bodies in harm’s way every day, and with the physical demands of their jobs, they tend to retire much earlier than most public service workers,” Rich Linton, president and COO at Empower, said in a statement. “We understand this unique workforce and their need to start saving as early as possible. All of us at Empower look forward to helping these first responders prepare confidently for their futures.”

TruStage Financial Group Bolsters Zone Income Annuity

Insurance, investment and technology provider TruStage Financial Group Inc. announced it has enhanced the Zone Income Annuity underwritten by MEMBERS Life Insurance Company, with new withdrawal flexibility for both existing and new contracts.

With the changes, clients can begin receiving guaranteed lifetime income as early as two businesses days after the contract is issued; change from single to joint lifetime income any time before lifetime income begins; and withdraw any amount up to the full lifetime income payment, according to a press release.

“Providing clients with greater power over their financial futures is vital to our work at TruStage,” Dave Hanzlik, vice president of annuity & retirement solutions, said in a statement. “With these enhancements to our Zone Income annuity, investors will be better able to adapt the product to a variety of lifestyle considerations and income needs.”

TruStage Financial group is the marketing name for CMFG Life Insurance company, subsidiaries and affiliates.

Confluence Technologies Partners With Northfield Information Services to Enhance Analytics

Confluence Technologies Inc. announced it has partnered with Northfield Information Services Inc. to offer users of Confluence Revolution—a platform for investment professionals—enhanced performance attribution and risk analytics services. 

Partnering with Northfield bolsters its clients’ analysis of multi-asset class portfolios, according to a Confluence press release. Existing Revolution clients can immediately begin using analysis with Northfield’s factor models. 

“Multi-factor risk analysis across asset classes has become a key industry practice for our customers. They are looking for a comprehensive tool that can easily provide in-depth factor level analysis of both risk and performances,” said Damian Handzy, senior product manager at Confluence, in a statement. “That’s why we set out to partner with Northfield, to enhance our award-winning risk modelling and performance attribution capabilities with additional insight of a multi-factor approach. “

TCW Group Grows ETF Lineup

Global asset manager TCW Group Inc. announced it has completed the conversion of two mutual funds into exchange-traded funds—the TCW Artificial Intelligence ETF, trading under the symbol AIFD and the TCW Compounders ETF, trading under symbol GRW.

“This signifies TCW’s continued growth trajectory in ETFs as we develop new and compelling investment solutions that meet the evolving needs of our clients,” said Katie Koch, president and CEO of TCW, in a press release. “As we continue to innovate, we remain focused on cross-sector, long term megatrends, such as AI, and their transformative impact. We will continue to pursue accessible, efficient products poised to capture ongoing and emerging opportunities in the market.”

The TCW Artificial Intelligence TF was previously known as the TCW Artificial Intelligence Equity Fund, trading under the symbol TGFTX, and the TCW Compounders ETF was previously known as the TCW New America Premier Equities Fund, trading as TGUSX.

The TCW Artificial Intelligence ETF is an actively managed fund, investing in companies involved in development and commercialization of artificial intelligence technology; AIFD concentrates on companies building core technology, artificial intelligence systems and those already adopting the technology; and each Fund’s investment objective is long-term growth of capital, TCW Group says in the release.

Goldman Adds Alternatives Lending Feature for Indie Advisers

Goldman Sachs’ adviser solutions custodial group has added a lending feature with the goal of giving eligible registered investment advisors the ability to borrow against some alternative investment positions in their portfolios. The addition from the Goldman Sachs Advisor Solutions group is designed to provide a new liquidity option to “sophisticated” investors, according to a release.

The firm noted Cerulli Associates research forecasting that RIAs plan to expand alternative investments by 31.1% in the next two years, the largest allocation increase of any investment type.  Custodians traditionally offer lending against publicly traded securities, but the new option will give them liquidity access as borrowed against alternative asset classes.



Human Interest Launches DOL Audit Defense Service for Small Business Plan Sponsors

Human Interest announced three new services for small businesses with the goal of making qualified plans less “costly, risky, and difficult,” according to an announcement.

The small 401(k) providers  offers small businesses Department of Labor audit defense, tax savings maximization, and notice delivery protection. The offerings include:

  • Up to $50,000 in audit expense coverage, what the firm calls a “first” in the industry;
  • Simplification of the process of claiming tax credits that can reduce or fully cover 401(k) costs for small businesses, which is also a first, according to the firm; and
  • Notice delivery protection when plan sponsors send paper mail notices to employees.

Rakesh Mahajan, Human Interest’s chief revenue officer, added in a statement that: “Human Interest is focused on helping the 33.2 million small and medium-sized businesses of America provide their employees access to retirement without the stress that has historically accompanied offering this life-changing benefit. The new DOL Audit Defense service and embedded tax credit support are both the first of their kind in the industry. Our new services may save employers upwards of 100 hours of administrative and compliance work per year and tens of thousands of dollars in costly, unplanned expenses.”

The Concierge package is listed at $200 a month and $9 per eligible employee on Human Interest’s website.

Products May 9, 2024

AllianceBernstein Expands Access to Secure Income Portfolio

Plan sponsors can access the AllianceBernstein Secure Income Portfolio.

Reported by

AllianceBernstein today announced it has increased plan sponsors’ access to the firm’s retirement-income-generating investment—the AB Secure Income Portfolio—by removing restrictions on its use to only AB’s customized plan sponsor retirement plan designs. The expansion of distribution is due to growing sponsor demand.

For plan sponsors, separating the Secure Income Portfolio from the glide path and target-date funds offers retirement plans an investment option that participants can use to generate guaranteed retirement income without changing the plan’s target-date fund provider. The Secure Income Portfolio may be used as part of a qualified default investment alternative, explains Jennifer DeLong, the head of defined contribution at AB.

“We’re making available the Secure Income Portfolio as a ‘standalone option,’ that can be utilized with [the sponsor’s] existing target-date fund, it can be utilized as an allocation in a managed account and it could also be used as a core menu option,” says DeLong.

For minimum initial investments in the AB Secure Income Portfolio AB institutional separate account requires sponsors to commit $100 million in assets to use it on the plan’s core menu or as an allocation in a managed account; or $250 million in target-date fund assets to use it alongside the plan’s existing target-date funds as part of the plan’s default, explains DeLong.

For defined contribution plans, AB launched the Lifetime Income Strategy, in 2012. The Secure Income Portfolio has been a component of the strategy for more than a decade, AB said in a press release.

“The lifetime income strategy is the holistic solution that includes the target-date [fund], so that’s $11 billion in total assets as of the end of Q1 2024,” says DeLong. “Within that lifetime income strategy within the target date, the secure income portfolio is that insurance vehicle, that’s about $4 billion. The whole thing is the lifetime income strategy—Secure Income Portfolio is the piece that we’re now offering separately from our glide path services.”

AB’s lifetime income strategy invests in a flexible guaranteed-income portfolio backed by multiple insurers. Guaranteed income is provided by insurers selected through a competitive bidding process based on factors, including financial strength, AB said in a press release.

Currently, five “large,” plan sponsor clients use the lifetime income strategy, says DeLong.

“It’s a professionally managed investment option that provides guaranteed income for life at retirement, while also maintaining liquidity and growth potential,” explains DeLong. “The underlying investment is a balanced index fund, that’s 50% equities, 50% fixed income.”

AB’s Secure Income Portfolio invests in a variable annuity with a guaranteed lifetime withdrawal benefit rider, adds DeLong.

Plan sponsors are spending their time and energy learning about lifetime income options to add to their plans, searching for ways to implement flexible options, says DeLong.

“We have the secure income portfolio; it’s been up and running; we can offer it separately; from our glide path and our target date solutions,” she says.

RTX Corp. was among AB’s first committed plan sponsor clients when it launched the strategy in 2012, says DeLong. RTX Corp. worked with AB to design its lifetime income strategy.

Sponsors are “interested in offering guaranteed income to their [participants], but they prefer to keep their existing target-date provider or they might be using target-date [funds] as their default option; they may also offer managed accounts as opt-in, but they’re interested in allowing participants to have access to guaranteed income,” says DeLong.   

«