BlackRock wants to capture more of the nation's retirement savings dollars, and it thinks it has a product that can do just that.
At a press briefing today in New York City, the investment management firm introduced its new series of retirement income indexes aimed at helping pre-retirees convert savings into an annual income during retirement. The BlackRock CoRI Retirement Index series is specifically targeted for those aged 55 to 64 and is currently comprised of 10 U.S. bond indexes.
BlackRock executives touted its latest offering as unique in the marketplace and one that remedies the leading concern of pre-retirees: How much money can I expect in retirement?
Chip Castille, head of BlackRock's U.S. and Canada Defined Contribution Group, said the CoRI Indexes are similar to target date funds. Each index is pegged for the year in which the individual turns 65.
Specifically, the CoRI Indexes track the estimated cost of $1 in future, inflation-adjusted lifetime income. It's further constructed to converge with the median price of an annuity at age 65.
Castille said that the start age of 55 was chosen because an individual has one-quarter of his working life remaining and therefore, has time to make corrections and reach his objectives. He conceded there is "tremendous movement" in the indexes, but the cost of saving for retirement can be volatile. The indexes, he added, are also designed to manage volatility in a retirement savings portfolio.
