John Hancock Offering Both 'To' and 'Through' Target-Date Funds
BOSTON, MA, August 24, 2010 -- John Hancock Retirement Plan Services (RPS) today announced that they will offer two suites of Lifecycle portfolios providing participants a choice in asset allocation options to match their individual 401k needs.
As part of this announcement, John Hancock is introducing new Retirement Choices(+) target-date portfolios which are designed to take participants "to" retirement and accommodate the participant who wishes to select another investment strategy at time of retirement. The asset mix is made up of index funds and the design features a lower amount of equities near retirement – which could give participants more confidence near retirement.
Retirement Choices joins John Hancock RPS's original Lifecycle suite, which was introduced in 2006 and has been renamed Retirement Living. The Retirement Living Lifecycle Portfolios are designed to allow investors to stay in the same portfolio through their retirement years. The portfolios allocate to best-in-class managers and offer more potential for growth by maintaining higher overall exposure to equities.
"People saving for retirement have different needs, and today's announcement further enhances our participants' ability to select the Lifecycle alternative that is right for them," said Ed Eng, Senior Vice President, Product Development, John Hancock RPS. "And we are able to offer these alternatives while helping those participants understand their choices by providing the tools and education to become retirement ready."
Prior to launching Retirement Choices, John Hancock RPS commissioned a survey almost 1,000 participants to gain a better understanding of what they are looking for in asset allocation solutions, and specifically when it comes to target-date funds.
More than four in five participants (83%) who responded to the survey felt it was important for their plan to offer a choice of target-date funds designed to meet the needs of different types of investors. In fact, when asked about preference for "to" retirement versus "through" retirement lifecycle options, respondents were split almost evenly between the two choices. "This finding is absolutely in line with our belief that participants need meaningful choices – in investment options in general but within target-date solutions as well," said Eng. "With these new portfolios, we took a very participant-centric approach by addressing the simple fact that participants have different needs."
Eng explains glide path differences between the suites. "The glide path for Retirement Choices portfolios features a lower allocation to equities and slopes down at a faster pace than it does for the Retirement Living portfolios."
"Offering these two suites together will help plan sponsors meet the diverse needs of their participants," said Arthur Creel, Executive Vice President, Sales and Marketing, John Hancock RPS. "We have also spent a lot of time designing educational and enrollment materials to help employees understand their choices and decide whether they are in the investment options that best meet their needs. This focus on helping participants to understand the alternatives begins with the Retirement Choices and Retirement Living names and continues throughout the enrollment and educational experience."
For over 15 years, John Hancock has been offering asset allocation portfolios to help investors save for retirement. As a leader in the industry, John Hancock offers on their 401k platform, the risk-based Lifestyle Portfolios (with nearly $60 billion in AUM), and the age-based Retirement Living and now Retirement Choices Portfolios.
About Retirement Choices and Retirement Living portfolios
The target date for the portfolios represents the year participants in the portfolio plan to retire and stop making contributions. It's important before selecting a portfolio for participants to consider their personal circumstances, risk tolerance which may change near retirement, what the portfolio invests in, how its asset allocation mix shifts over time, and the time it takes to reach its final asset mix. The principal value of an investment in any portfolio is not guaranteed at any time, including at, or after, the target date. There is no guarantee that any portfolio will provide adequate income at and through retirement. For details on the underlying fund, refer to the prospectus.
About John Hancock Retirement Plan Services
John Hancock Retirement Plan Services is one of the largest providers of 401k plans across all plan sizes among banks, mutual funds and insurers, according to CFO Magazine. (CFO Magazine 2010 401k Providers Survey, for year-end 2009. Published in May 2010). Both John Hancock Life Insurance Company (U.S.A.) and John Hancock Life Insurance Company of New York do business under certain instances using the John Hancock Retirement Plan Services name. Group annuity contracts and recordkeeping agreements are issued by: John Hancock Life Insurance Company (U.S.A.), Boston, MA 02210 (not licensed in New York) and John Hancock Life Insurance Company of New York, Valhalla, NY 10595. Product features and availability may differ by state.
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