The U.S. Senate's Special Committee on Aging listened to rigorous testimony last week, debating the suitability of lifetime income products within defined contribution retirement plans like 401(k)s.

"There has been a trend away from sponsorship of defined benefit plans and a dramatic increase in the offering of defined contribution plans such as 401(k) plans, shifting a number of risks for retirement security on to the shoulders of American workers," Assistant Secretary of Labor of the Employee Benefits Security Administration Phyllis Borzi said in her testimony before the committee. "This trend, combined with increasing life expectancies, significantly increases the risk that retirees will outlive their retirement income."

The trend toward defined contribution plans, which provide a retirement benefit based on contributions and investment returns, has dramatically shifted the risk from employers to workers, Borzi continued, since workers do not receive a promised benefit or assurances as to the adequacy of their account balance.

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