Insights

The zombies are coming!!... for their retirement savings

Just as auto-enrollment breathed life into the savings game for “zombie participants,” it’s time for a “set-it-and-go” solution that does the same for retirement income. Participants deserve a plan that delivers steady, predictable monthly income for life—no haunting decisions required.

October 27, 2025

Joanne Karalolos, CFA

Investment Strategist

Today, the majority of defined contribution (DC) retirement savers shuffle silently forward, displaying the same passive behaviors: they don’t actively rebalance their portfolios, or actively adjust their contribution rates—they set their course on day one and rarely look back. These so-called “zombie participants” have been enabled by automation to save for their retirement—which begs the question: If we’ve automated the path to retirement, why haven’t we automated the path through it?

Over the past two decades, the defined contribution industry has quietly transformed the journey toward retirement. Through innovations like automatic enrollment, automatic escalation, and target date funds (TDFs), a system was created that has helped plan participants “do the right thing” without having to do much at all. These tools, grounded in behavioral finance, have turned saving for retirement from a high-stakes self-serve guessing game into a guided, automated journey.

And the results speak for themselves. Participants are saving more, investing more appropriately, and staying on track. In a country where fewer than 30% feel confident in their financial knowledge —and where the average person reports simply not having the time to regularly review, adjust, or even think about their retirement plan — automation isn’t a crutch, it’s a lifeline.

The next frontier: Automating decumulation

Participants need to shuffle through retirement with the same ease they experienced while saving for it. They need a “set-it-and-go” retirement income plan, one that delivers predictable, consistent monthly income for life, with minimal effort.

We believe that to provide predictability and enable retirement confidence and security, a retirement income solution has to consider the participant experience first, and be:

Simple: an intuitive and fully integrated digital election experience, allowing participants to model and elect their plan with ease and confidence.
Flexible: providing structured choices to minimize decision paralysis while enabling customizable pathways that reflect the diverse needs of participants.
Impactful: enables participants to activate income leveraging their entire target date fund balance.

IncomeWise: Designed with the Zombie Participant in mind

At the heart of IncomeWise is a participant experience that’s as straightforward as it is powerful—allowing participants to model and elect their preferred retirement income plan with ease and confidence. It’s purpose-built for the zombie participant—someone who wants to make a few simple decisions and then move on to enjoy the next phase of life knowing they’ve put in place a plan for their future. IncomeWise empowers participants to convert their entire target date fund balance into a stream of automatic monthly income, which starts immediately and is designed to last a lifetime.

The IncomeWise participant experience is designed to be:

Fully integrated: The IncomeWise participant experience is fully integrated with a plan’s recordkeeper platform, enabling participants to model features, make elections through a simplified checkout process, and receive ongoing support—all within the same digital environment. This integration provides a sense of consistency and familiarity that encourages informed action with little effort.
Structured, yet flexible: In retirement, needs vary widely based on individual circumstances. Realizing this, the IncomeWise participant experience is designed to simplify the decisions needed to build a Retirement Income Plan. Within these decisions, we apply structured choice to reduce decision paralysis—guiding participants step-by-step through the process. At the same time, the experience offers flexibility and customization, recognizing that retirement isn’t “one-size-fits-all.”
Frictionless: IncomeWise comes with pre-determined annuity features to reduce complexity, further minimizing decision paralysis. Also, the integrated election process can be completed in minutes—no applications, no approvals, no waiting to initiate one’s elections. This allows participants to move seamlessly through the experience with minimal friction, making it easy to take action and drift back into a set-it and forget-it state.
Instantaneous: Once elected, income starts automatically—no additional action is required. Participants begin receiving monthly retirement income soon after, with the potential for that income to last a lifetime.

In short, IncomeWise wakes the zombie just long enough to briefly engage—then lets them go back to sleep, confident that their plan to generate retirement income is on autopilot.

Evolving the default—and the experience

The DC industry has proven that automation works. Automatic enrollment, automatic escalation, and target date funds have transformed how participants save for retirement, quietly guiding them toward better saving outcomes.
But as we look to the future, it’s not enough to evolve our investment offerings alone. To truly support participants through retirement, we must pair these evolved investments with a participant experience that is just as simple, intuitive, and seamless.

By combining a modernized target date fund with a simple, structured, and fully integrated participant experience, IncomeWise empowers participants to take action—if and when they choose—with confidence and ease. With just two main decision points, no applications, and no waiting for approvals, participants can easily activate a lifetime income stream.

It’s automation with intention. Simplicity with flexibility. And a future where even the most passive participant can glide into retirement with clarity and control.

Contact us

For more information about the IncomeWise participant experience or to request a demonstration of the IncomeWise Retirement Income Tool, please contact us at SSGADefinedContribution@ssga.com.

Footnotes

Disclosures

Important information

State Street Global Advisors (SSGA) is now State Street Investment Management. Click here for more information.
For institutional / professional investors use only.

Information Classification: General Access

Investing involves risk including the risk of loss of principal.

Diversification does not ensure a profit or guarantee against loss.

This material is for educational purposes only; no investment, financial or tax advice or recommendation is provided. It does not suggest taking or refraining from any course of action and should not be used as basis for making any investment decision. It is not designed to be a recommendation of any specific insurance or investment product or strategy and it should not be considered a solicitation to buy or an offer to sell any security or insurance product.

The information in this material solely illustrates some aspects of IncomeWise. It does not take into account any investor’s particular investment objectives, strategies, tax status or investment horizon. Plan participants should consult their tax and financial advisor(s) prior to making a decision to invest in IncomeWise or elect or not Deferred Guaranteed Income or Immediate Income. Neither State Street Global Advisors (“SSGA”) nor its affiliates or representatives engages or has engaged in the delivery of investment advice to plan participants.

Plan participants should refer to the Participant Disclosure Document in the IncomeWise Retirement Income Tool for important disclosures, risks and information about IncomeWise, including Deferred Guaranteed Income and Immediate Income.

IncomeWise is not intended to be a complete investment program, but rather intends to supplement a plan participant’s retirement savings strategy. Participants should consult their own advisers regarding the role of the IncomeWise features in their overall retirement savings approach. There is no guarantee that IncomeWise will satisfy a participant’s retirement goals or needs. IncomeWise does not protect against the risk that participants deplete or outlive their retirement savings.

IncomeWise Retirement Income is comprised of two features available for eligible participants to elect: Deferred Guaranteed Income and Immediate Income. Deferred Guaranteed Income (QLAC) and Immediate Income are subject to eligibility requirements, conditions and limitations.

Deferred Guaranteed Income is an option available only to eligible plan participants and refers to the purchase of a qualified longevity annuity contract (QLAC), which is an insurance product issued to electing participants by a third-party insurance company that guarantees monthly payments that begin at age 78 money at a future date, typically for the rest of the plan participant’s an individual’s life, or for the life of the spouse of the plan participant as applicable, whichever is longer. Deferred Guaranteed Income (QLAC) is subject to eligibility requirements, conditions and limitations.

QLAC payments are subject to the claims-paying ability of the issuing insurance company; it is possible that the issuing company may not be able to honor the annuity payouts at any time. The QLAC is provided by a third-party insurance company selected by SSGA annually. SSGA offers no assurances or guarantees of the selected annuity provider’s performance. SSGA undertakes no obligation to review or monitor the performance of an insurance provider with respect to a purchased QLAC following the date of purchase.

Immediate Income is an option available only to eligible plan participants who elect Deferred Guaranteed Income. Immediate Income is subject to eligibility requirements, conditions and limitations.

Immediate Income refers to automatic monthly drawdowns from a plan participant’s eligible IncomeWise balance that the participant may elect to receive via IncomeWise. Immediate Income distributions are not guaranteed and are subject to the continuing sufficiency of the plan participant’s eligible assets invested in IncomeWise. Immediate Income distributions may fluctuate year-over-year, may not last until and will likely materially decrease at age 78, and may not continue thereafter.

SSGA does not make any recommendation about whether the Immediate Income feature or amounts or drawdown rate is/are suitable for any individual plan participant. The election to purchase or not Deferred Guaranteed Income is made by each individual participant. SSGA does not provide investment or tax advice or recommendations, or otherwise act as a fiduciary, to plan participants in connection with these elections. Plan participants should consult their tax and financial advisor(s) with respect to Deferred Guaranteed Income.

Deferred Guaranteed aIncome/QLAC payments and Immediate Income distributions are not insured by the FDIC or any other governmental agency, and are not an obligation of the FDIC or a deposit or obligation guaranteed by SSGA or any of SSGA’s affiliates, including State Street Bank and Trust Company, or any other bank.

The QLAC terms and cost may not be the most favorable available to plans or plan participants. The QLAC purchase is subject to market availability and the selection of an insurance provider. A participant may rescind the QLAC purchase during the “free-look period” and after this period the QLAC purchase is irrevocable.

A participant’s Immediate Income distribution amount is calculated by a third party based on SSGA’s cohort drawdown rates and the participant’s eligible plan assets in the IncomeWise Spending Fund. The distribution amount is adjusted annually and when turning 78, and will not adjust to account for the start of QLAC annuity payments earlier than age 78, which could result in savings being depleted faster than intended. Participants may cancel Immediate Income for any reason at any time, including if they do not wish to receive the adjusted distribution amount. Once cancelled, Immediate Income cannot be reinstated.

The drawdown rate is not personalized to fit any participant’s individual circumstances. The drawdown rate methodology may result in insufficient or excess retirement income that does not reflect a participant’s needs or goals. There is no guarantee that the assumptions and forecasts underlying the drawdown rate methodology will accurately reflect future events, market conditions, investment returns or plan participant savings activities. Participants should not rely on the drawdown rate for their financial planning. SSGA does not provide investment or tax advice or recommendation with respect to the drawdown rate.

The election of Deferred Guaranteed Income and Immediate Income is optional. Participants who make an election are also electing to move their IncomeWise plan assets to the IncomeWise Spending Fund. Participants who do not make an election continue to be invested in the State Street Target Retirement Funds (IncomeWise Class).

State Street does not make any recommendation about whether IncomeWise is suitable for any individual plan participant. The election to participate or not in IncomeWise is made by each individual participant. State Street does not provide financial or investment or tax advice or recommendations, or otherwise act as a fiduciary, to plan participants in connection with these determinations or these elections. Plan participants should consult their tax and financial advisor(s) with respect to IncomeWise.

The State Street IncomeWise Spending Fund (“Spending Fund”) is designed for investors who purchase the QLAC. It has a fixed allocation that targets approximately 45% to equity and other assets (e.g., commodities and REITs) and 55% to fixed income. There may be other considerations relevant to fund selection and participants should select the fund that best meets their individual circumstances and investment goals.
Asset allocation does not guarantee a profit or protect against loss. An investment in the Spending Fund is neither insured by the FDIC or any other governmental agency, nor guaranteed by SSGA or any of SSGA’s affiliates, including State Street Bank and Trust Company, or any other bank. Please refer to the disclosure documents for the Spending Fund for further information on this fund and important risk considerations associated with an investment in it.

Asset allocation is a method of diversification and may be used in an effort to manage risk and enhance returns; however, it does not ensure a profit or protect against loss.

Assumptions and forecasts used by SSGA in developing the IncomeWise strategies’ allocation may not be in line with future events, market conditions, capital market returns, participant savings activities or actual retirement date. This could result in losses or in IncomeWise or the funds not providing adequate or any income, before, near, at or after the target date or the anticipated or actual retirement year, or throughout retirement or life.

Ages and expected retirement dates are approximate and may not reflect a plan participant’s actual age or retirement date at each phase or stage of the strategy. Participants are responsible for selecting their own target retirement date.

Investing involves risks including the risk of loss of principal. An investment in the funds is neither insured by the FDIC or any other governmental agency, nor guaranteed by SSGA or any of SSGA’s affiliates, including State Street Bank and Trust Company, or any other bank.

The IncomeWise Retirement Income Tool (“Tool”) offers certain educational materials and two different experiences: the Modeling Experience and the Election Experience. Access to the Tool and the experiences depend on participants’ age, meeting certain eligibility criteria, electing the IncomeWise features, and other factors. The Tool may be used to learn more about IncomeWise and explore, for educational purposes, hypothetical scenarios of potential or estimated IncomeWise retirement income payments. The Tool may also be used to make, manage and cancel elections subject to certain conditions and limitations.

The Tool does not recommend any income strategy to plan participants. It is not a source of investment advice and should not be relied upon as such. SSGA does not provide any financial or investment or tax advice or recommendation via the Tool. SSGA does not provide any fiduciary recommendation to plans, plan sponsors, plan fiduciaries or plan participants in connection with or via the Tool. The Tool is hosted by a third party and SSGA does not guarantee the proper functioning of the Tool. Errors in or the malfunction of the Tool may impact a plan participant’s ability to use the educational components, elect Deferred Guaranteed Income and Immediate Income, and/or manage the elections. Further, SSGA does not guarantee the accuracy of the information in the Tool provided by plan participants, plan sponsors or recordkeepers, insurance companies, or any other third party. This information may adversely impact the availability of the election of Deferred Guaranteed Income and Immediate Income, the QLAC purchase, the distribution of Immediate Income or the distribution amount and cancellation thereof.
The State Street Target Retirement Funds (“Target Retirement Funds”) are designed for investors expecting to retire around the year in each fund’s name. When selecting a target date fund or “vintage”, participants should consider if they anticipate retiring significantly earlier or later than age 65, even if such participants retire on or near a fund’s approximate target date. There may be other considerations relevant to fund selection and participants should select the fund that best meets their individual circumstances and investment goals.
The Target Retirement Funds’ asset allocation becomes increasingly conservative as they approach their target date and beyond, and the investment risks of the funds change over time as their asset allocation changes. Once a target date fund reaches its target retirement date, it begins a five-year transition period to the retirement fund. Asset allocation does not guarantee a profit or protect against loss. An investment in the Target Retirement Funds is neither insured by the FDIC or any other governmental agency, nor guaranteed by SSGA or any of SSGA’s affiliates.

The IncomeWise funds (State Street Target Retirement Funds, State Street Target Retirement Income Fund, and State Street IncomeWise Spending Fund) are bank-maintained collective investment trust maintained and managed by SSGA. SSGA is a limited purpose trust company established under the laws of the Commonwealth of Massachusetts.

The Target Retirement Funds are available to certain eligible defined contribution plans pursuant to the Declaration of Trust of the State Street Global Advisors Trust Company Investment Funds for Tax Exempt Retirement Plans. The Target Retirement Funds are not mutual funds.

In reliance upon an exemption from the registration requirements under the federal securities laws, investments in the IncomeWise funds are not registered with the Securities and Exchange Commission (“SEC”) or any state securities regulator. In reliance upon an exclusion from the definition of an investment company under the Investment Company Act of 1940, as amended, the IncomeWise funds are not registered with the SEC as an investment company.

SSGA and its fiduciary activities are overseen by the Massachusetts Department of Banks (MA DOB) and, as a subsidiary of State Street Corp., a bank holding company, the Federal Reserve. Neither the MA DOB nor the Federal Reserve have reviewed or approved the IncomeWise funds or the information contained herein.

The IncomeWise funds are offered to certain eligible defined contribution plans pursuant to the Declaration of Trust (“DOT”) of the State Street Global Advisors Trust Company Investment Funds for Tax Exempt Retirement Plans. The DOT establishes State Street’s powers, authority and obligations in respect of the investment, administration and operation of the IncomeWise funds, as well as the eligibility, rights and obligations of each plan participating in the IncomeWise funds.

The IncomeWise funds are not mutual funds and are not registered with the SEC or any state securities regulator, and as such a prospectus is not required.

The whole or any part of this work may not be reproduced, copied or transmitted or any of its contents disclosed to third parties without SSGA’s express written consent.

All information is from SSGA unless otherwise noted and has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. There is no representation or warranty as to the current accuracy, reliability or completeness of, nor liability for, decisions based on such information and it should not be relied on as such.

The information provided does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor's particular investment objectives, strategies, tax status or investment horizon. You should consult your tax and financial advisor.

Bonds generally present less short-term risk and volatility than stocks, but contain interest rate risk (as interest rates raise, bond prices usually fall); issuer default risk; issuer credit risk; liquidity risk; and inflation risk. These effects are usually pronounced for longer-term securities. Any fixed income security sold or redeemed prior to maturity may be subject to a substantial gain or loss.

The trademarks and registered trademarks referenced herein are the property of their respective owners. Third party data providers make no warranties or representations of any kind.

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