Blueprint Income Has a Plan for the 'Personal Pension'

Experts everywhere are talking about Blueprint Income, a new firm whose flagship product is called the Personal Pension.

The Personal Pension is a deferred income annuity that you purchase over time in what the company says are "manageable" installments. And, unlike pensions, the Personal Pension doesn't require your employer to sponsor the plan, according to the firm.

Given all the hubbub over this new business, we thought it worth asking Matthew Carey, the co-founder of Blueprint Income, some questions about the company, its value proposition, and just who might consider using the company's service.

Question: What is Blueprint Income? What's its history?

Answer: We've built a technology-first platform for guaranteed retirement income -- whether bought at all at once or in small amounts over time, and no matter what channel they want to purchase it.

The company's flagship product is the Personal Pension, a guaranteed paycheck that lasts as long as you live. It's more accessible than traditional annuities because the Personal Pension is purchased over time in manageable installments. In the parlance of the annuity market, it's a subscription-based deferred income annuity.

The company also offer access to the entire income annuity market (qualifying longevity annuity contracts or QLACs, deferred income annuities or DIAs, and immediate annuities).

I started the company with two co-founders, Adam Colombo and Nimish Shukla, while a Wharton MBA. I had spent time prior to that at the U.S. Treasury, where I focused on retirement security. As a founding team, we saw real challenges for individuals with the decline of the employer pension and we didn't think anyone was adequately using the power of technology to replace it. Most annuity products sold today are very complicated at a time when people want simple products and a simple process. It didn't make sense to us. Annuities should be the replacement for pensions.

Question: Can you tell us a bit about some of your backers and advisers? I see that Jean Chatzky and Mark Iwry are involved.

Answer: We announced our seed round in March. The round was led by Green Visor Capital and NextView Ventures, with participation from Core Innovation Capital, Kairos, and angel investor Jean Chatzky, among others.

The company's advisory board includes personal finance expert Jean Chatzky, Amazon's Dean Foster, Google's Kent Eisenhuth, former senior U.S. Treasury official Mark Iwry and behavioral scientist Hal Hershfield, Ph.D.

Question: What is the unmet need that it addresses for those saving for/living in retirement?

Answer: Without a pension, you're left to manage market risk and longevity risk on your own. That's scary.

Question: How is it different from buying annuities from Vanguard,, or

Answer: We've built this company from the ground up using cutting-edge software. We've digitized most steps of the process to improve information, speed, and outcome. Our technology allows someone to do everything from comparing policies, applying, and managing their account fully digitally.

In addition, their agent will be likely be a CFA charterholder, which I don't think is something anyone else can say. We spend a lot of time modeling someone's retirement-income picture and we have an actuary on our team who leads those efforts. Our pricing is always competitive.

Question: What is the business model? How is your firm compensated for the service? Through lead generation? Commissions? Something else?

Answer: Commissions, which vary by insurer, but are the lowest in the industry when possible. We put the consumer first and commit to acting as a fiduciary.

Question: What are the pros and cons of an investor using your service?

Answer: If they're looking for a guaranteed income stream and they don't have one through their employer, none I can think of. But if they want to be entirely in the stock market or are in poor health, then an annuity (and therefore we) are probably not right for them

Question: Who is it best for? Someone whose odds of running out of money are high?

Answer: It's best for those who are healthier and have some bond/fixed-income exposure. If you're investing in bonds in your retirement portfolio and are healthy, this often makes sense for you, whether you're GenX and still some years from retirement or retiring imminently.

Question: Who doesn't stand to benefit from using Blueprint Income? Someone who is overfunded and has good odds of managing longevity?

Answer: If you aren't in good health, believe you'll receive steady returns in the stock market, and generally aren't willing to trade liquidity for guaranteed income, this probably isn't a good fit for you. Said differently, if you're not in good health or if you don't have bonds in your portfolio, this likely won't make sense for you.

Question: Who are the insurers on the platform? Will you add others over time?

Answer: We have about 15 insurers on the platform now, including Guardian Life, Lincoln, and most other large, well-rated insurers in this market.

Question: What else do people need to know about Blueprint?

Answer: The way the annuity market is discussed today, I think, is backwards. Annuities are valuable because of their guarantee. It's something else no other financial product can provide -- the promise of guaranteed lifetime income. Other than the guarantee, you're probably better off in a low-cost index fund that provides market exposure. So, when it comes to retirement income planning, we urge clients to keep it simple.

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