Voya Expands Suite of Target Date Solutions for Retirement Plan Participants With Launch of MyCompass American Funds
- New target date series supports increasing demand for active equity management from advisors and builds on success of MyCompass Index, which has reached more than $2 billion in plan assets since 2019
Voya Financial, Inc., announced the launch of MyCompass American Funds, the latest addition to Voya’s suite of target date fund (TDF) solutions for plan sponsors. Now available to all Voya retirement plan customers, MyCompass American Funds offers a collective investment trust (CIT) target date series that includes management from industry leaders including Voya Investment Management (IM), American Funds from Capital Group and Wilmington Trust Co. The new target date series further complements Voya’s current suite of TDF solutions including MyCompass Index and those offered through Voya IM.
Based on increasing demand from retirement plan advisors, the solution was built to support a more active equity management approach, leveraging the success of Voya’s MyCompass Index solution, which was launched in 2019 and in just two years has achieved more than $2 billion in plan assets.
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Specifically, Voya’s MyCompass American Funds CIT target date series is designed to build and preserve the wealth of individuals by offering the following key features and benefits:
- Thoughtful glidepath that balances market risk and longevity risk by emphasizing funds with historically higher-yielding, lower volatility equity funds as the participant ages;
- Actively managed underlying funds;
- Flexible mandates, such as global and multi-asset funds, that enable bottom-up asset allocation tilts with the goal of enhancing returns and helping to mitigate risk; and,
- A stable value allocation that seeks to reduce volatility.
“Plan sponsors understand that plan participants have unique needs when it comes to planning for retirement. As a result, plan advisors are increasingly seeking more ways to offer their clients additional investment opportunities to meet their needs,” said Bill Harmon, chief client officer, Voya Financial. “At Voya, we are committed to providing products and services that can ultimately help all Americans achieve a secure financial future with confidence. Innovative solutions, including those such as MyCompass American Funds target date series, provide greater opportunity for plan sponsors and advisors to help individuals on their retirement planning journey.”
Often serving as the default investment option for individuals’ defined contribution plans, target date fund strategies continue to grow in popularity among employers, retirement plan advisors and plan participants alike. According to the latest industry data from the Employee Benefit Research Institute, at year-end 2018, more than half (56%) of 401(k) participants in their database held target date funds, with target date fund assets accounting for more than one-quarter (27%) of total 401(k) plan assets.2
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“Professionally managed, age-appropriate portfolios that automatically rebalance to keep participants on target have long made TDFs an appealing investment decision. At the same time, 2020 put a spotlight on the risk that uncertain markets can create for individuals when it comes to their overall investment strategy and decisions, including those within their retirement plan,” added Jeff Cimini, senior vice president, Retirement Product Management at Voya Financial. “For advisors, we also know that active management during periods of extreme volatility can allow for more efficient support. We’re thrilled to provide an innovative, new solution that features a ‘glidepath within a glidepath’ approach, balancing market and longevity risk to generate return and ultimately help provide greater retirement outcomes for plan participants.”
“We’re thrilled to be working together with Voya to offer MyCompass American Funds to plan sponsors who want to leverage the proven building blocks of the American Funds target date series,” said Brendan Mahoney, head of Institutional Retirement Strategic Growth at Capital Group. “The series incorporates the knowledge and experience of Voya Investment Management on a recordkeeping platform with extensive participant resources to support the complete retirement journey.”
In addition to investment choices, Voya also believes it is important to drive changes in behavior and action through a multi-channeled approach — which includes engaging experiences and solutions. As a result, Voya continues to invest in its suite of innovative savings and planning resources, including the recently enhanced retirement plan participant website experience, its out-of-plan emergency savings solution, budget calculator and Voya Learn digital educational platform.
As an industry leader focused on the delivery of health, wealth and investment solutions to and through the workplace, Voya Financial is committed to delivering on its mission to make a secure financial future possible for all Americans — one person, one family, one institution at a time.
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