By Randy Myers
As millions of Americans enter retirement the challenge of turning savings into steady income has never been more pressing, says Jason Fichtner, executive director of the Retirement Income Institute of the Alliance for Lifetime Income, by LIMRA. And, he says, stable value has an immediate role to play in responding to that challenge.
Addressing the 2025 SVIA Fall Forum during a “fireside chat” with Nick Gage, head of stable value contract strategy at Galliard Capital Management, Fichtner described a U.S. retirement system at a crossroads as plan sponsors, policymakers, and financial professionals rethink how to provide sustainable income for retirees. In addition to developing and deploying appropriate income solutions, he said, the industry will need to reframe its message and shift the conversation from complex financial jargon to relatable concepts like “income,” “stability,” and “a paycheck in retirement.”
To illustrate the power of language, Fichtner recalled walking into Social Security Administration field offices as Acting Deputy Commissioner of the Social Security Administration in the late 2000s and seeing posters promoting the numbers “62, 65, 70.” The figures referred to the milestone ages at that time when people could claim Social Security benefits, with 62 the “early eligibility age” and 65 “full retirement age”—even though higher benefits could be had by waiting until age 70. The net effect of that language, Fichtner said, was to subtly encourage early claiming, even though many retirees could benefit, over the long run, from waiting.
Fichtner mentioned a bill recently passed out of the House Ways and Means Committee that would recast “early benefit age” as “minimum monthly benefit age” and “full retirement age” as “normal monthly benefit age”—succeeded, finally, by “maximum monthly benefit age” for those who have turned 70.
“Imagine how that changes the framing and the narrative for someone who walks into a Social Security field office and says, ‘When should I take benefits?’” Fichtner remarked.
Fichtner said the retirement industry also can help people think more clearly about generating retirement income if it touts the importance of having an “income plan” rather than a “decumulation strategy.”
“Decumulation sounds like you’re going down to zero,” he said. “No one likes that.”
Promoting the concept of a “paycheck in retirement” would also be helpful, Fichtner said, noting that workers are accustomed to getting a paycheck from their jobs and want that same stability in retirement.
The “Peak 65 Zone” and the Broken Three-Legged Stool
Recent research from Fichtner has focused on what he calls the “Peak 65 Zone”—the period between 2024 and 2027 when more Americans will turn 65 each day than ever before and face the challenge of converting savings to income. This year is the peak of the Peak 65 Zone, he noted, with 11,400 baby boomers turning 65 every day. But retirement income could be an even bigger issue for the Gen Xers following directly on the boomers’ heels and the millennials after them, who now represent the largest living generation of Americans. Their challenge has been exacerbated by cracks in the classic “three-legged stool” of retirement security: Social Security, employer pensions, and personal savings. With defined benefit plans disappearing and Social Security facing a projected 20% benefit cut in 2033 if Congress fails to act, Fichtner warned that the remaining leg—defined contribution savings—must be strengthened.
He expressed optimism that policymakers will fix Social Security before 2033, perhaps with an assist from a president who doesn’t want the Social Security fund to be depleted on his or her watch. But potential fixes—higher taxes, reduced benefits—would likely hit younger generations the hardest.
Fear of Spending—and the Power of Income
Fichtner said one of the greatest obstacles retirees face in managing their retirement assets is psychological: the fear of outliving their savings. His research shows that retirees are far more comfortable spending from income sources—such as Social Security or an annuity—than from accumulated savings. In fact, some see not touching principal as a badge of honor even if it prevents them from fully enjoying retirement. By generating additional sources of protected income, retirees can live fuller and more financially successful lives. People with protected income beyond Social Security feel more secure financially and spend more freely, Fichtner said. They also are more comfortable staying invested during market downturns, which can leave their investment portfolios better off in the long run.
The Role of Plan Sponsors and Policy
Fichtner praised the SECURE and SECURE 2.0 Acts for making it easier to include income options in defined contribution plans. Still, many employers remain hesitant to add annuities or other lifetime income options because of fiduciary concerns. Until those concerns are addressed more fully, he suggested, stable value funds can play an immediate and meaningful role in delivering reliable retirement income.
Fichtner described stable value as “an easier, low-friction way to get income into plans right now,” while also offering the added benefit of liquidity. He said a newly issued SVIA white paper, “Stable Value Funds as an In-Plan Retirement Income Strategy,” could be helpful in educating retirement plan sponsors, participants, the media, and public policy experts about using the asset class in that role.
Longer term, Fichtner sees target-date funds incorporating income products into their makeup, including, perhaps, “bridge annuities” that allow workers to delay claiming Social Security and maximize benefits. In fact, he argued, retirement income choices should be embedded into retirement plans as a default investment option. And, he said, stable value needs to be one of those default options.
Finally, Fichtner urged employers to begin treating financial wellness as an employee benefit by giving workers access to education and unbiased guidance as part of their retirement plan, since employees trust their employers for information, guidance, and education. He also encouraged plan sponsors to make greater use of automatic enrollment and auto-escalation features, which help workers save without requiring active decisions.
“People don’t plan to fail; they fail to plan,” he observed.