401 (k) retirement income options coming your way (MoneyWatch) Now that 401 (k) and other defined contribution (DC) plans are the primary type of retirement plans in the U.S., the big challenge for financial planners is helping employees generate a reliable, lifetime income from their retirement savings. According to a recent survey of more than 500 large employers by HR consulting firm Aon Hewitt, help might be on the way under in form of your 401 (k) plan. The survey found that 16 percent of companies now offer an in-plan retirement income solution; another 22 percent are likely to adopt such a solution in 2012. Helping employees retire with sufficient assets is a top priority for 44 percent of the surveyed companies. More than three-quarters of newly hired employees participate in a DC retirement plan as their primary retirement plan, according to Aon Hewitt. With the continuing shift from traditional pension plans to DC plans, it's more important than ever for employers to adopt measures so they can operate these plans as true retirement plans, instead of just wealth accumulation plans. How to fix the 401 (k) plan IRAs and 401 (k): 3 ways to generate lifetime retirement income Various financial institutions have risen to this new retirement income challenge, recently introducing products and services to help convert participants' 401 (k) balances into reliable retirement income. Financial Engines, Prudential, UBS, AllianceBernstein, Vanguard, Fidelity, and Income Solutions have all introduced retirement income offerings for 401 (k) and IRA accounts. And these products are now being offered on the platforms of many large 401 (k) plan administrators, such as Fidelity, Vanguard, Aon Hewitt, and Mercer. I'll be assessing some of these plans in future posts. If you're offered a retirement income offering in your 401 (k) plan, you'll want to become familiar with its features and amount of retirement income you can generate. Some retirement income solutions involve "immediate annuities," others involve hybrid insurance products called guaranteed lifetime withdrawal benefits (GLWB), some involve managed payouts, and others combine managed payouts with annuities. Each of these products has different features regarding lifetime guarantees, inflation protection, access to your savings, and exposure to market risk. And each yields a different amount of retirement income. I'll comment on how the various retirement income solutions meet each of these goals in my future posts. Americans like choice, and that's particularly important with your retirement security. Generating a retirement paycheck is not a "one size fits all" exercise; you'll want to understand not only your 401 (k) plan's options but your alternatives if you don't like the retirement income options offered by your plan. If you're approaching your retirement years and your 401 (k) plan doesn't offer a retirement income solution, politely ask your employer's HR and finance departments to investigate these options. Employers often respond to employees' requests, particularly when the request is reasonable and meets a compelling need. Show them this article if you need ammunition. If you put in the time and effort now to learn how to generate a lifetime retirement income, you'll be happier when you hit your 80s and 90s and your retirement paycheck is still chugging along. Image courtesy of iStockphoto contributor scibak