Prudential Retirement, a subsidiary of Prudential Financial, has added two target date fund management partners to the range of alternative offerings under Prudential IncomeFlex Target.

Effective immediately, T Rowe Price and Vanguard will be integrating their target date fund offerings with Prudential's guaranteed minimum withdrawal (GMWB) benefits. Like traditional target date funds, the merged offering adjusts the asset mix by lessening equity exposure and increasing exposure to fixed income type investments as they near the target retirement date. Ten years before the target date, the GMWB is automatically activated, guaranteeing a lifetime income amount for plan participants. 

"Nine out of ten participants in defined contribution retirement plans seek guaranteed income they can't outlive," said Christine Marcks, president of Prudential Retirement. 

"These new IncomeFlex funds offer investors the combined benefits of target date strategies along with two key forms of income protection - income protection during market downturns and guaranteed lifetime income in retirement."

An additional one per cent guarantee fee will be charged upon activation and guarantees are based on the claims-paying ability of the insurance company.