The Benefits of Stable Value Funds for Plan Participants
Stable value is touted as helping near-retirees manage sequence risk, should they have the misfortune of retiring into a downturn, but these investments offer advantages for participants of all ages.
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If plan sponsors are looking for reassurance that stable value investments are beneficial to retirement plan participants, they need look no further than the Stable Value Investment Association (SVIA)’s fourth quarter 2020 survey, which found that assets in these vehicles rose 12% throughout the year to $906 billion, to now comprise 10% of all defined contribution (DC) plan assets.
Even though the market rebounded last year after a sharp drop-off, participants reacted differently to that decline, with many moving to the safety of stable value, notes Gina Mitchell, president of the SVIA.