The LifePath Paycheck™ solution is here

PRESS RELEASE

BlackRock activates retirement solution offering a paycheck for life

CHAIRMAN'S LETTER

Time to rethink retirement - and that includes retirement income

People work, and plan, and save because they know that life doesn’t stop in retirement. Yet even with the best preparation, many are still at risk of outliving their savings. Longer lives and economic headwinds have made the path to a secure retirement ever more challenging. And people are looking for help answering the question, how do I make my money last?

Introducing LifePath Paycheck™ funds, the next evolution of Target Date solutions. Providing participants with the option to purchase lifetime income from insurance companies selected by BlackRock, complete with an accompanying digital experience.

Like a traditional target date fund, LifePath Paycheck™ becomes more conservative over time, but it doesn’t stop at just stocks and bonds. It starts allocating to a new asset class called “lifetime income” beginning in the year a participant turns age 55 – which, at retirement, can then be used to purchase the annuities from the selected insurers.

That means, in retirement, participants receive a paycheck they can count on every month, every year, for life.

And with the MyLifePath™ digital experience, participants get a clear picture of how today’s contributions can translate to tomorrow’s retirement income, shifting mindsets and encouraging positive savings behaviors to help participants reach their retirement goals.

Managed by BlackRock, LifePath Paycheck™ funds and the MyLifePath™ digital experience.

Driving towards a simpler, more secure path to retirement by providing participants with the option to purchase a lifetime income stream so that you can retire from work, but not a paycheck.

Now available in defined contribution plans

Workers are looking for help answering the question, how much of my nest egg can I spend in retirement… and not run out?

We’ve launched a solution. LifePath Paycheck™ combines the simplicity of a target date strategy with the increased certainty of an annuity from insurers selected by BlackRock to offer participants a paycheck for life.

Why retirement income?

#1

Because we’re living longer – and that should be a good thing. In the 20th century, the average American lifespan grew by about 30 years.¹

Life expectancy has grown from 47 in 1900 to 79 in 2023.

There are two cakes. One is labelled 47 years with a single flickering candle. It represents the life expectancy in 1900. The other cake is labelled 79 years with three flickering candles. It represents the life expectancy in 2023. Confetti is exploding behind the 2023 cake.
#2

Because outliving savings is a top financial concern - and employers want to help.

60% of workplace savers worry they will outlive their retirement savings;2 and 99% of plan sponsors feel responsible to help fix that.3

There are 2 people. One is labelled 60% savers worry. It is 60% filled yellow and has two smaller people behind representing employees. This represents 60% of workplace savers worry they will outlive their retirement savings. The other person is labelled 99% employers feel responsible. It is wearing a tie and is 99% filled yellow. This represents 99% of employers feel responsible to help fix that.
#3

Because having guaranteed retirement income can help retirees’ wallets – and minds.

People can get a 22% average increase in potential retirement spending from a target date strategy with an embedded income solution;4 and 93% of workplace savers say having more certainty around retirement income would help their mental health.5

For illustrative purposes only.

There is a piggy bank and a heart. The piggy bank is labelled 22% savings increase. It has a coin falling in and is 22% filled pink. It represents that people can get a 22% savings increase in potential retirement spending from a target date strategy. The heart is labelled 93% well-being boost. The heart is 93% filled pink. It represents that 93% of workplace savers say having more certainty around retirement income would help their mental health.
OUR PUBLICATIONS

Insights for better outcomes

Women live longer. Can they afford it?
A look at gender, life expectancy, and the need for retirement income
Living longer should be a good thing. And it can be with the right tools – for both getting to and through retirement. Women may face different challenges to retirement saving, but there are levers employers can pull to ensure women feel secure in knowing that when work stops, financial security doesn’t have to.
Six reasons to consider retirement income
What the research reveals for workplace retirement savers

People are living longer. But for the most part, we’re not choosing to put off retirement. From financial security to mental fitness, here are 6 ways guaranteed lifetime income can benefit workers as they enter that next chapter.

Our principles of decumulation
A framework for spending down assets in retirement

Financial advice often focuses on boosting personal savings rates and maximizing return on investment during a worker’s accumulation years. Equally important, however, is the decumulation process, when people spend those savings in the form of income.

How to optimize retirement income
Joint research with the Bipartisan Policy Center

Leveraging BlackRock’s proprietary lifecycle model, our analysis demonstrates how taking a holistic approach to retirement income benefits savers. In particular, a few steps can potentially generate more retirement income and decrease risk.

Life doesn’t retire™

The MyLifePath™ platform is a digital experience that is accessible through an eligible retirement plan’s recordkeeper. MyLifePath provides information about LifePath Paycheck and provides a means of facilitating an eligible participant’s annuity purchase option with the selected insurers.
mlp tool

Lights, camera, income…

Check out our latest videos on retirement income – and the impact it can have.

RoR BBL

Social Copy #1: Gen Z or Gen X – who feels more prepared for retirement? BlackRock’s KC Boas highlights 6 stats from our annual Read on Retirement® survey. #BLKBottomLine

Read the survey here: https://www.blackrock.com/us/individual/insights/retirement/retirement-survey?cid=emc:RORVanityurl:MULTI:EBC:US:NA

Social Copy #2: What are the most common challenges workers say they face in saving for retirement? This episode of #BLKBottomLine highlights 6 stats from our annual Read on Retirement® survey.

https://www.blackrock.com/us/individual/insights/retirement/retirement-survey?cid=emc:RORVanityurl:MULTI:EBC:US:NA

The 6 Stats That Have Us Rethinking Retirement

When it comes to saving for retirement, no two paths are the same. In our 9th annual Read on Retirement survey, we talked to nearly 4,000 people and found that today’s savers and retirees are rethinking retirement. Here are 6 stats that really stood out.

Title:

2024 Read on Retirement®

 The 6 Stats that have us rethinking retirement

Gen Z may be the youngest generation in the workforce, but they’ve already got retirement on the brain. They’re just not sure what to do about it. 63% say they don’t understand how to manage their retirement investments – and they’re looking to employers for help.

Millennials, on the other hand, are feeling the squeeze – trying to balance near-term expenses with long-term needs. And debt doesn’t help. 72% say they would stay with their current employer if their 401(k) plan matched student loan payments.

For Gen X, retirement is getting closer on the horizon – but they’re not cutting the cake just yet. They’re actually the least likely to feel on track for retirement. And 74% worry they won’t have the income certainty that retirees used to have.

Secure income in retirement is a top concern for Baby Boomers, too. In fact, 85% of those who are already retired say it makes a much bigger difference than they thought it would.

Across generations, gender differences also stand out. 65% of women are worried about outliving their retirement savings - versus just over half of men. Which makes sense, since women tend to live about 6 years longer.

And then, of course, there’s those who don’t have a workplace retirement plan. Left on their own to figure out how to save for retirement, 56% are turning to cash – missing out on the power of the markets over time.

The bottom line is…

Retirement is personal – and there are lots of different paths to get there. But, while there are a million ways to spend retirement, everyone wants to spend it feeling secure.

Disclosures

This material is intended for information purposes only, and does not constitute investment advice, a recommendation or an offer or solicitation to purchase or sell any securities, funds or strategies to any person in any jurisdiction in which an offer, solicitation, purchase or sale would be unlawful under the securities laws of such jurisdiction. The opinions expressed are as of August 2024 and are subject to change without notice. Reliance upon information in this material is at the sole discretion of the reader. Investing involves risks. 

In the U.S., this material is intended for public distribution.

© 2024 BlackRock, Inc. All Rights Reserved. BLACKROCK is a registered trademark of BlackRock, Inc. or its subsidiaries in the United States and elsewhere. All other trademarks are those of their respective owners

RoR BBL

Social Copy #1: Gen Z or Gen X – who feels more prepared for retirement? BlackRock’s KC Boas highlights 6 stats from our annual Read on Retirement® survey. #BLKBottomLine

Read the survey here: https://www.blackrock.com/us/individual/insights/retirement/retirement-survey?cid=emc:RORVanityurl:MULTI:EBC:US:NA

Social Copy #2: What are the most common challenges workers say they face in saving for retirement? This episode of #BLKBottomLine highlights 6 stats from our annual Read on Retirement® survey.

https://www.blackrock.com/us/individual/insights/retirement/retirement-survey?cid=emc:RORVanityurl:MULTI:EBC:US:NA

The 6 Stats That Have Us Rethinking Retirement

When it comes to saving for retirement, no two paths are the same. In our 9th annual Read on Retirement survey, we talked to nearly 4,000 people and found that today’s savers and retirees are rethinking retirement. Here are 6 stats that really stood out.

Title:

2024 Read on Retirement®

 The 6 Stats that have us rethinking retirement

Gen Z may be the youngest generation in the workforce, but they’ve already got retirement on the brain. They’re just not sure what to do about it. 63% say they don’t understand how to manage their retirement investments – and they’re looking to employers for help.

Millennials, on the other hand, are feeling the squeeze – trying to balance near-term expenses with long-term needs. And debt doesn’t help. 72% say they would stay with their current employer if their 401(k) plan matched student loan payments.

For Gen X, retirement is getting closer on the horizon – but they’re not cutting the cake just yet. They’re actually the least likely to feel on track for retirement. And 74% worry they won’t have the income certainty that retirees used to have.

Secure income in retirement is a top concern for Baby Boomers, too. In fact, 85% of those who are already retired say it makes a much bigger difference than they thought it would.

Across generations, gender differences also stand out. 65% of women are worried about outliving their retirement savings - versus just over half of men. Which makes sense, since women tend to live about 6 years longer.

And then, of course, there’s those who don’t have a workplace retirement plan. Left on their own to figure out how to save for retirement, 56% are turning to cash – missing out on the power of the markets over time.

The bottom line is…

Retirement is personal – and there are lots of different paths to get there. But, while there are a million ways to spend retirement, everyone wants to spend it feeling secure.

Disclosures

This material is intended for information purposes only, and does not constitute investment advice, a recommendation or an offer or solicitation to purchase or sell any securities, funds or strategies to any person in any jurisdiction in which an offer, solicitation, purchase or sale would be unlawful under the securities laws of such jurisdiction. The opinions expressed are as of August 2024 and are subject to change without notice. Reliance upon information in this material is at the sole discretion of the reader. Investing involves risks. 

In the U.S., this material is intended for public distribution.

© 2024 BlackRock, Inc. All Rights Reserved. BLACKROCK is a registered trademark of BlackRock, Inc. or its subsidiaries in the United States and elsewhere. All other trademarks are those of their respective owners

Simply better prepared. For life.™

Introducing LifePath Paycheck™: the next generation of target date solutions that include an option to purchase a lifetime income stream from insurers selected by BlackRock. In other words, participants can get a paycheck for life.

Here’s how it works:

Early Career

LifePath Paycheck is focused on growth when participants are young and is primarily invested in equity and equity-like assets.

This breaks down as 99% Equity and 1% Fixed Income.

Later Career

Starting at age 55, LifePath Paycheck begins allocating to a new asset class called “lifetime income,” which grows over time.6

This breaks down as 52% Equity, 9% Inflation, 24% Fixed Income and 15% Lifetime Income.6

Retirement

Beginning at age 59 ½, participants can:

Get a paycheck for life by opting to purchase a lifetime income stream for retirement – payable by insurers selected by BlackRock.

The remaining retirement plan savings can either be invested in a target date solution designed to complement the lifetime income stream,7 in another retirement plan investment option, or redeemed for cash.

This breaks down as 37% Equity, 9% Inflation, 24% Fixed Income and 30% Lifetime Income.

Disclaimer

For illustrative purposes only and subject to change.

Here’s what your plan participants get:

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Choice
Offers participants daily liquidity, flexibility to purchase a lifetime income stream and the ability to customize lifetime income benefits.
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Convenience
A familiar target date strategy that addresses the complexity of buying a traditional annuity in a simple way.
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Cost-efficiency
No commissions, loads, distribution fees or surrender charges.

Contact our institutional team to learn more about defined contribution

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