Education and longevity solutions are two of the biggest opportunities available to 401(k) providers, according to a study by String Financial.
And despite conventional wisdom that annuities and other mortality contingent products cannot succeed on a meaningful scale in 401(k) plans, 30% of investors said they would definitely and 40% said the would probably be willing to give up leaving a greater inheritance if they could have a greater amount of lifetime income.
In addition, 71% said they were concerned about having enough income to meet their standard of living in retirement.
Thirty-four percent of respondents said that educational materials offered by their 401(k) plan didnt properly explain concepts, and 41% said the materials could be easily found elsewhere. Only 18% said the materials prompted them to make changes in their retirement plans.
While insurers are better positioned than mutual fund companies to offer longevity solutions, they will have to make a critical shift to becoming solution-oriented organizations, as opposed to product-oriented business units, according to String Financial.