How much does IncomeFlex Target cost?
In addition to investment management fees, activating the IncomeFlex Target guarantee also triggers an annual 1% guarantee fee. This fee will reduce the fund’s investment return and is reflected in the Market Value on a daily basis.
When does this fee take effect?
When the guarantee is activated.
Can money be transferred in and out of the target date funds?
Yes. But, money moved out may not be transferred back into that particular target date fund for 90 calendar days.
Can participants change their mind and cancel the IncomeFlex Target guarantee?
Yes. Participants can transfer some or all of what they’ve invested in the Day One IncomeFlex Target Funds into another investment option in the plan at any time. This will cancel guarantees, but no additional fees or charges will apply.
Is there a way to also provide income to a participant’s spouse?
Yes, married participants can elect the Spousal Benefit. This allows for the surviving spouse to continue receiving guaranteed lifetime income for the remainder of his/her life.
How much can IncomeFlex Target participants withdraw each year?
The amount will be determined at “Lock In” based on:
|*Age at "Lock In"
||Benefit for Participant
||Benefit for Participant & Spouse
*Based on the age of the younger participant or spouse.
When can participants “Lock In”?
Participants can “Lock In” any time after they turn 55, provided their lifetime annual withdrawal amount is a minimum of $250.
Can a participant withdraw more in one year than their lifetime annual withdrawal amount?
Yes. However, excess withdrawals will reduce a participant’s lifetime annual withdrawal amounts in subsequent years. Note: If a participant’s Market Value falls to zero dollars due to excess withdrawals, the lifetime annual income amount will no longer be received.
Can the Day One IncomeFlex Target Funds be used as a qualified default investment alternative?
What happens to the IncomeFlex guarantee if a participant leaves the plan, or if the plan discontinues the option from the plan's investment lineup?
If, for whatever reason, a participant of any age is no longer able to invest in the IncomeFlex fund, the provisions of the SECURE Act allow that participant to transfer or "roll over" their IncomeFlex guarantee into an individual retirement account that invests in a variable annuity contract available through Prudential Retirement. Both Market Value and Income Base will move over intact. This contract may have substantially different fees, investments and provisions affecting the guarantees. If a participant rolls any portion of their IncomeFlex Market Value into anything other than a specific Prudential-issued variable annuity, all Prudential IncomeFlex guarantees will immediately cease.
What if an IncomeFlex participant passes away?
If permitted by the terms of the retirement plan, any remaining Market Value can be passed on to beneficiaries as a death benefit.
Guarantees are based on the claims-paying ability of the Prudential Retirement Insurance and Annuity Company (PRIAC), and are subject to certain limitations, terms and conditions.
Withdrawals or transfers (other than transfers between IncomeFlex Target Funds) proportionately reduce guaranteed values prior to Locking-In. After Lock-In, withdrawals in excess of the lifetime annual withdrawal Amount will reduce future guaranteed withdrawals proportionately and may even eliminate them entirely.
The target date is the approximate date when investors plan to retire and may begin withdrawing their money. The asset allocation of the target date funds will become more conservative until the date which is ten years prior to the target date by lessening the equity exposure and increasing the exposure in fixed income investments. The principal value of an investment in a target date fund is not guaranteed at any time, including the target date. There is no guarantee that the fund will provide adequate retirement income.
A target‐date fund should not be selected solely based on age or retirement date. Before investing, participants should carefully consider the fund's investment objectives, risks, charges and expenses, as well as their age, anticipated retirement date, risk tolerance, other investments owned, and planned withdrawals.
The stated asset allocation may be subject to change. It is possible to lose money in a target date fund, including losses near and following retirement. These risks may be increased to the extent investors begin to make withdrawals from the fund significantly before the target date. Investments in the Funds are not deposits or obligations of any bank and are not insured or guaranteed by any governmental agency or instrumentality. For investors close to or in retirement, the fund’s equity exposure may result in investment volatility that could reduce an investor’s available retirement assets when they are needed. For investors further from retirement, there is risk that a fund may invest too much in investment designed to ensure capital conversation and/or current income, which may prevent the investor from meeting his or her retirement goals.