Thasunda Brown Duckett
CNBC
Fears of an AI stock bubble have many investors watching — and some worrying — about its impact on their retirement accounts.
TIAA CEO Thasunda Brown Duckett, who heads one of the nation’s largest retirement plan providers, says that shouldn’t be retail investors’ greatest concern.
When eyeing the AI-driven market gains, “I think the real question is not knowing if it’s going to burst or boom. It’s about making sure you’ll be prepared for retirement,” Brown Duckett said in an interview on the sidelines of TIAA’s FutureWise conference in Washington, DC, earlier this week.
The focus of investors saving for retirement should be on building a diversified portfolio that includes a guaranteed income stream, she said.
‘Income has to be the outcome,’ for retirement savings
“It’s not about timing the market. It’s about how much time you put in the market,” she said. “And as we think about that diversification, how do we ensure that there’s income within it? Income has to be the outcome.”
That income, she says, could come from annuities or insurance products that provide regular payments for retirement income.
More than one-third (35%) of 225 decision makers at U.S. defined contribution plans said they will prioritize adding retirement income solutions to their offering in the next 12 months, according to a new survey by Mercer, a global HR and benefits consulting firm. Defined contribution plans include employer-sponsored retirement plans, like 401(k)s and 403(b)s.
TIAA is a major provider of 403(b) plans, annuities, and retirement income products, particularly for the nonprofit sector, including colleges and universities and health care systems. Last year, TIAA entered the 401(k) market, offering lifetime income products in target-date funds. Altogether, the firm manages over $1.4 trillion in assets for more than 5 million people.
“We have to make sure that the everyday investor in their retirement does not get to a position that they were too far on the risk curve, that they did not have the counterbalance, which is income,” Brown Duckett said, when asked how investors should react to volatility.
Since 2019, federal laws have made it easier to offer annuities in 401(k) plans. TIAA views this as an opportunity to sell its lifetime income products to a much broader share of the $12.5 trillion defined contribution plan market.
However, research shows most everyday investors don’t understand annuities and retirement income products. While 28% of financial professionals think clients understand annuities “very well,” only 14% of clients agree, according to a 2025 study by the Alliance for Lifetime Income by LIMRA, a non-profit consumer education organization.
Balancing alternative assets risk in retirement plans
Now, the White House is endorsing the inclusion of private credit, private equity, real estate, and other alternative investments in 401(k) plans, too, which can entail greater risk than stocks and bonds – and annuities.
Before adding those private assets to a workplace retirement plan, Brown Duckett said this question should be answered first: “How do we ensure that we’re educating people along the way so that we don’t get over-excited when you’re in a bull market, and then when that bear hits, you see a real decline that you didn’t anticipate in your retirement plan?”
“I do think alternatives can be a good thing,” she added, “but I do think it has to be balanced with lifetime income to offset it, because it is riskier.”
Brown Duckett says investors need income in their retirement portfolios so they won’t run out of money, regardless of how long they live or how much markets fluctuate.
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