U.S. Labor Department seeks public comments on lifetime income options for retirement plans

Washington – The U.S. Departments of Labor and the Treasury today announced the publication of a request for information (RFI) soliciting public comments to assist the agencies in determining what steps to take to enhance retirement security for workers in employer-sponsored retirement plans through lifetime annuities or other arrangements that provide a stream of income after retiring. The RFI appears in today’s edition of the Federal Register.

“Today’s initiative is particularly important given the shift from defined benefit plans that offer employees lifetime annuities to 401(k) and other defined contribution plans that typically distribute retirement savings in a lump sum payment,” said Phyllis C. Borzi, assistant secretary for the Labor Department’s Employee Benefits Security Administration.

The RFI seeks comments on a broad range of topics, including:

• The advantages and disadvantages of distributing benefits as a lifetime stream of income both for workers and employers, and why lump sum distributions are chosen more often than a lifetime income option.
• The type of information participants need to make informed decisions in selecting the form of retirement income.
• Disclosure of participants’ retirement income in the form of account balances as well as in the form of lifetime streams of payment.
• Developments in the marketplace that relate to annuities and other lifetime income options.

Written comments responding to the lifetime income RFI may be addressed to the U.S. Department of Labor, Office of Regulations and Interpretations, Employee Benefits Security Administration, N-5655, 200 Constitution Ave. NW, Washington, DC 20210, Attn: Lifetime Income RFI. The public also may submit comments electronically by email to E-ORI@dol.gov or through the federal e-rulemaking portal at www.regulations.gov.