Plan member research

Connecting savings with income

DC retirement income study: Connecting savings with income


Invesco’s 2022 retirement income study reflects on the pressing need to help plan members turn their defined contribution plan savings, into long-term retirement income.

Together with Greenwald Research, we connected with 118 US plan sponsors and consultants, and over 1,000 US DC plan members – all working for large employers – through online surveys, in-depth interviews, and virtual focus groups.

We examined how plan members think about retirement income in general, and the types of in-plan solutions and resources most attractive among different employee demographics.

Our first key insight takes a closer look at how plan sponsors can better connect members’ lifelong savings with income in retirement.

By offering retirement income benefits – and encouraging members to stay in the plan when they retire – plan sponsors can help ease the transition into retirement.

In fact, 77% of plan sponsors in our survey preferred plan members stay in the plan when they retired.

However, more work needs to be done. While half of plan sponsors say they actively encouraged members to stay in the plan, only 28% of employees were unsure if it was even allowed, including three in 10 Gen X and baby boomers.

If specific investments were available to help them create a regular stream of retirement income, nine in 10 plan members would stay in their DC plan when they retired.

Understandably, plan sponsors have been cautious and slow to adopt retirement income solutions.

51% wanted more guidance on current regulations, and 65% needed more information on retirement income solutions currently available.

Yet almost all plan members would view their employer favorably if they added specific retirement income solutions to the plan.

With 83% of members expecting their DC plans to be their largest source of income in retirement, plan sponsors have a significant opportunity to help members of all ages along their planning journey.

To learn more about the findings from our 2022 DC retirement income research study, visit our website, or contact your Invesco DC professional.


In Canada, this material is restricted to accredited investors as defined by National Instrument 45-106. This material is provided to you for informational purposes only and may not be distributed or shared with others.

Cited Invesco research is based on Invesco’s work with Greenwald Research. Invesco is not affiliated with Greenwald Research. Participant quotes are used with permission.

This information was prepared for US investors and may contain information that may be materially different for Canadian investors. These differences may affect suitability for Canadian investors, and these materials should not be relied upon by Canadians in making any investment decisions. This material is provided to you for informational purposes only and may not be distributed or shared with others. The information provided is general in nature and may not be relied upon nor considered to be the rendering of tax, legal, accounting or professional advice. Readers should consult with their own accountants, lawyers and/or other professionals for advice on their specific circumstances before taking any action.

This material is for illustrative, informational and educational purposes only. If the illustrations herein are used outside of the designated audience, it is the respective user’s responsibility to ensure that such material complies with all applicable regulations and is filed with the appropriate regulatory bodies if so required. Words and phrases utilized should always be appropriate, applicable and provable. We make no guarantee that participation in this program or utilization of any of its content will result in increased business or higher participant rates.

The opinions expressed are subject to change without notice. These opinions may differ from those of other Invesco investment professionals. This does not constitute a recommendation of any investment strategy or product for a particular investor. Investors should consult a financial professional before making any investment decisions.

Annuities can be purchased within or outside of qualified retirement plans and traditional IRAs. Annuity benefits and features vary, so an investor should carefully consider whether this product is right for them. Some benefits may incur additional costs. Any guarantee associated with an annuity is subject to the claims-paying ability of the issuing life insurance company. Invesco does not offer Insurance products. All investing involves risk, including the risk of loss.

This is not intended to be legal or tax advice or to offer a comprehensive resource for tax qualified retirement plans. Any products referenced are not intended to represent any specific Invesco products.

Invesco® and all associated trademarks are trademarks of Invesco Holding Company Limited, used under license.      Published 12/30/22       NA2624207       2022 Invesco Canada Ltd.     All rights reserved.

Our 2022 retirement income study focused on plan sponsor and member preferences for turning defined contribution (DC) savings into retirement income. We teamed with leading research firm Greenwald Research on an extensive study involving connecting with more than 100 plan sponsors and consultants and 1,100 members (all working for large US organizations with at least 5,000 employees) through online surveys, in-depth interviews, and virtual focus groups­.

Plan sponsors’ thinking has evolved with most recognizing the importance and value of members staying in plan. In fact, almost eight in 10 preferred members keep their assets in the plan at retirement, with half (50%) saying they have taken steps to encourage it.

At the same time, many members recognized the benefits of leaving money in their current DC plan when they retire – including the familiarity of their employer’s plan and the convenience of staying put – but most planned to roll their money out of their plan into other accounts. Why?

Plan features that have helped members save for retirement over the years may not quite fit the needs of near-term and current retirees today as they start to spend down their savings. Echoing that notion is the fact that many members felt that their plan did not offer enough investment choice or flexibility to accommodate their unique needs in retirement. However, our research shows members are open to staying in the plan at retirement under the right circumstances.

Plan sponsors have a significant opportunity to help members connect savings to retirement income. They can include income solutions to the plan in stages, such as first determining the plan’s goals and objectives to help members create income in retirement. Also, sponsors can highlight to employees their ability to create an income stream through various investments and flexible distribution options the plan has specifically selected for their retirement income needs.

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Our latest defined contribution research reflects upon the evolving retirement industry today as it faces the pressing need to help plan members turn their DC plan savings into long-term retirement income. We connected with over 100 plan sponsors and 1,000 members to better understand their preferences for creating retirement income and what features, resources, and approaches to communications resonated across the generations.

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