BlackRock’s LifePath Paycheck, a solution designed to provide access to a paycheck-like income stream during retirement, is only available in defined contribution plans — at least for now.
“Today, yes, LifePath Paycheck is only available in defined contribution plans — stay tuned. … We would love to be able to do something for people who don’t have access … maybe through an ETF or a mutual fund, but that’s not available yet,” said Anne Ackerley, head of retirement at BlackRock, in response to a question during an April 24 media roundtable at BlackRock’s headquarters in New York.
The LifePath Paycheck solution takes a fresh approach to retirement income by providing access to guaranteed income through a target-date fund, an investment strategy that adjusts automatically to a targeted retirement year.
Plan participants will have the option to access the guaranteed income as early as age 59½ by buying annuity contracts issued by Equitable and Brighthouse Financial.
BlackRock is “trying to meet investors where they are,” added Nick Nefouse, managing director and global head of LifePath at BlackRock, who cited the launch late last year of the iShares LifePath Target Date ETF suite. BlackRock described those funds as “the industry’s only suite of target-date ETFs.”
“So, we would love to take LifePath Paycheck and put it into different markets and new markets,” Nefouse said. “We’re starting with the employer market, and then we would move from there. The ETFs were built for those people that don’t have access to the employer 401(k) market.”
BlackRock believes 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,” BlackRock Chairman and CEO Larry Fink said April 24 in a news release.
As of March 31, BlackRock had about $10.5 trillion in total assets under management.
