Plan Sponsors Broaden Outlook on In-Plan Retirement Income

Defined contribution consultants predict developments in participant and sponsor education, fee transparency and product availability will increase the adoption of guaranteed income solutions among plan sponsors, according to PIMCO’s 2026 DC Consulting Study.

Guaranteed income products remain in the early stages of adoption but are “moving from concept to action,” PIMCO’s report stated. Both institutional consultants and aggregators pinpointed target-date funds with embedded annuities as the “next likely wave in sponsor adoption of retirement income features,” with firms such as Fidelity, TIAA and BlackRock having already made strides in recent years to make the products part of participants’ core menus.

Participants’ appetite for retirement income is strong as well: A recent survey from Corebridge found more pre-retirees and retired Americans (47%) would prefer $60,000 per year guaranteed for life instead of a $1 million lump sum at age 65 (41%). Retirees surveyed said having guaranteed lifetime income would enable them to spend more on personal fulfillment, including travel (69%), home improvements (29%) and dining out (25%).

But looking ahead, consultants told PIMCO the following developments could bring product adoption among those groups to a higher level:

• The increased availability of guaranteed income products across multiple recordkeeping platforms, ranked as a top-three development by 74% of institutional consultants and 69% of aggregators;
• Sponsors gaining education about the variety of guaranteed income products already available, ranked by 48% of institutional consultants and 77% of aggregators;
• Better education and decisionmaking tools to help participants feel more comfortable opting in, ranked by 52% of institutional consultants and 54% of aggregators; and
• Greater transparency into the value provided and why fees could be worthwhile, ranked by 65% of institutional consultants and 54% of aggregators.

Institutional consultants and aggregators named participant flexibility, such as allowing individuals to choose when and how much of their savings to annuitize, as the most important feature of any guaranteed product. In all, 95% of those surveyed ranked participant flexibility as their top priority when evaluating lifetime income solutions.

Nonguaranteed Options Gain Steam

Guaranteed solutions may not be participants’ sole choice to generate a regular income stream in retirement, however. In this year’s study, institutional consultants said 52% of DC plan sponsors they advised said they already had an income-focused fixed-income option on their core menu. While aggregators said only 17% of plans they advised had one, 93% of aggregators whose clients did not have such an option said their clients would likely add nonguaranteed retirement income options, whether through fixed-income or multi-asset strategies, in the next year.

“These strategies aim to deliver consistent income and extend how long assets last, which can be translated into a monthly withdrawal stream in retirement,” wrote Rene Martel, PIMCO’s managing director and head of retirement, in a response to emailed questions.

But nonguaranteed products are not directly comparable to guaranteed products, Martel cautioned, and neither option is mutually exclusive; both can be used to create a retirement strategy.

“Guaranteed products provide near certainty,” Martel wrote. “Nonguaranteed strategies offer liquidity, flexibility, potential for higher income and often extended longevity if used properly—but without the absolute guarantee that they will last a lifetime.”

PIMCO collected responses in January and February from 38 consulting and advisory firms serving more than 53,000 DC plan clients with more than $10.2 trillion in assts.

Corebridge fielded its survey in October and November 2025 among 2,210 adults aged 45 through 79 with at least $100,000 in investable assets.