Valic Retirement Investment Options: A Comprehensive Review

The Variable Annuity Life Insurance Company, or VALIC, is a major provider of group retirement plans and services to schools, government agencies, hospitals, and other non-profit entities. VALIC ranks in the top 10 of all U.S. and Canadian life insurance companies, with over $86 billion in total customer assets under management as of December 31, 2014. The company offers a range of products, including mutual fund programs, fixed and variable annuities, asset management programs, and retirement accounts. With a national footprint and almost $27 billion in assets under management, VALIC Financial Advisors is a subsidiary of VALIC, providing discretionary investment management services and outsourcing portfolio construction to securities analysts.

Valic's parent company, The Variable Annuity Life Insurance Company

Valic (VALIC) is a retirement plan provider for health care, K-12, government, and nonprofit institutions. It is a subsidiary of Corebridge Financial, Inc. (CRBG) and is also known as AIG Retirement Services. VALIC is an acronym for its parent company, The Variable Annuity Life Insurance Company, which is based in Houston, Texas.

The Variable Annuity Life Insurance Company is an insurance corporation that specializes in tax-qualified retirement plans, supplemental tax-deferred, and after-tax investments. The company offers a range of products, including mutual fund programs, fixed and variable annuities, asset management programs, and college savings plans. It also provides group and individual retirement accounts, such as Traditional IRA, Roth IRA, and Spousal IRA.

As of December 31, 2014, the company had more than $86 billion in total customer assets under management and managed plans for nearly 24,000 groups, serving over 2 million plan participants across 41,000 locations in the U.S. The Variable Annuity Life Insurance Company is a certified member of the Insurance Marketplace Standards Association (IMSA) and ranked in the top 10 of all U.S. and Canadian life insurance companies based on its total assets under management as of 2014.

The Variable Annuity Life Insurance Company has a complex organizational structure and is owned by several entities, ultimately falling under the umbrella of American International Group (AIG), Inc. Despite its many subsidiaries and parent companies, VALIC has maintained its name and reputation in the retirement plan provider space.

Valic's fees and charges

Valic Financial Advisors is a fee-based firm. The fees and charges associated with Valic's services depend on the type of account and investment option selected. Here is a breakdown of the fees and charges:

Managed Investment Program (MIP)

For the MIP, Valic requires a minimum investment of between $5,000 and $250,000, depending on the chosen portfolio. MIP account holders are charged a program fee, which is a percentage of assets under management (AUM) and includes fees for services provided by the independent advisory representative (IAR), Valic Financial, Envestnet, the investment manager, and National Financial Services. The MIP program fee does not cover underlying mutual fund or exchange-traded fund fees and other costs. The rate may vary depending on the chosen portfolio.

Guided Portfolio Services (GPS)

Valic does not charge an advisory fee for its GPS Portfolio Advisor service. However, the GPS Portfolio Management Program has its own set of fees.

Guided Portfolio Advantage (GPA) Program

The GPA Program has an annual advisory fee of 1% of AUM. To enrol in the GPA Program, clients must purchase a Portfolio Director (PD) Freedom Advisor contract, which has a minimum premium payment of $25,000.

Surrender Fees

In certain circumstances, Valic may charge a surrender fee when clients withdraw their funds. The surrender fee is either 5% of the amount withdrawn or 5% of the contributions made within the past 60 months, whichever is less. There are some exceptions to the surrender charge, such as no surrender fee is applied if the client is at least 55 years old and no longer employed by the company offering the retirement plan.

Account Maintenance Charge

During the accumulation period, Valic charges a quarterly account maintenance fee of $3.75 if any portion of the client's account is invested in variable account options. This fee is waived for certain group contracts.

Separate Account Charges

Valic also charges separate account fees, which range from 0.65% to 1.15% during the accumulation period and 0.75% to 1.25% during the payout period. These fees are based on the average daily net asset value of Valic Separate Account A and compensate Valic for assuming certain risks.

Other Fees

Valic may also charge other fees, such as loan application fees and state premium taxes. Additionally, mutual funds have their own fees and expenses, which are detailed in their respective prospectuses. It is important for clients to carefully review the fee schedules and understand all the costs associated with their chosen investment options.

Valic's financial advisors

Valic Financial Advisors, Inc. is a subsidiary of The Variable Annuity Life Insurance Company (VALIC), which was founded in 1955 and is based in Houston, Texas. VALIC is a major provider of group retirement plans and services to schools, government agencies, hospitals, and other non-profit entities. With a national footprint, Valic Financial Advisors has nearly $27 billion in assets under management (AUM) and serves as both an investment advisor and a broker-dealer.

The advisors at Valic are technically independent advisory representatives (IARs) and broker-dealer representatives, and most are also insurance agents. This makes Valic a fee-based firm. Valic Financial Advisors offers discretionary investment management services through three wrap fee programs: the Managed Investment Program (MIP), the Guided Portfolio Services (GPS) Program, and the Guided Portfolio Advantage (GPA) Program. The MIP program requires a minimum account size of $5,000 to $250,000, depending on the portfolio, while the GPS and GPA programs have no minimum account size requirements.

Accounts in the MIP program can choose from 15 model portfolios, ranging from very conservative to very aggressive. These portfolios are managed by advisors from well-known companies such as Envestnet Portfolio Solutions, Inc., Russell Investment Management, LLC, and The Vanguard Group. The GPS program is available only to participants in a retirement plan with VALIC or VALIC Retirement Services Company, and investments are made in a VALIC Portfolio Director variable annuity or a mutual fund program. To be eligible for the GPA program, clients must purchase a VALIC PD Freedom Advisor fixed and variable annuity contract, and contributions are invested in diversified model portfolios designed and managed by Morningstar.

While Valic Financial Advisors has a large number of clients who are not high-net-worth individuals, they also serve high-net-worth clients and corporations. It is important to note that Valic Financial Advisors has been the subject of several disclosures and fines in recent years, including a $20 million penalty in 2020 for failing to disclose potential conflicts of interest to certain teachers in Florida.

Valic's investment philosophy

Valic, or The Variable Annuity Life Insurance Company, is a major provider of group retirement plans. It was founded in 1955 and is based in Houston, Texas. Valic is part of Corebridge Financial (formerly known as AIG Life & Retirement), which is owned by American International Group (AIG).

Valic offers a range of investment options for its clients, including mutual funds, exchange-traded funds (ETFs), annuities, and other investment vehicles. The company had more than $100 billion in total assets in December 2017 and manages plans for nearly 23,000 to 25,000 groups, serving approximately 1.8 million to 2 million participants.

Valic also provides a range of annuity options, including fixed, variable, and income annuities. Annuities are insurance products that can provide a steady income stream during retirement. Valic's annuity products are designed to meet the needs of its clients, offering guaranteed income options and the potential for tax-deferred growth.

In addition to mutual funds and annuities, Valic offers asset management programs, college savings plans, and group and individual retirement accounts, such as Traditional IRA, Roth IRA, and Spousal IRA. The company also provides discretionary investment management services through its wrap fee programs, allowing clients to choose from a range of model portfolios that match their risk profiles.

Overall, Valic's investment philosophy is centred around offering a comprehensive range of investment options to its clients, providing them with the tools and opportunities to achieve their retirement goals. The company's diverse product offerings and focus on asset management and retirement planning make it a popular choice for those seeking to secure their financial future.

Valic's ranking and assets under management

Valic, or The Variable Annuity Life Insurance Company, is a subsidiary of Corebridge Financial, formerly known as AIG Life & Retirement, an American International Group company. Valic is a major provider of group retirement plans and services, particularly for schools, government agencies, hospitals, and other non-profit entities. The company was founded in 1955 and is headquartered in Houston, Texas.

As of 2023, Valic Financial Advisors, Inc. has almost $27 billion in assets under management (AUM). Valic is also a broker-dealer and its advisors are independent advisory representatives (IARs). They are also broker-dealer representatives, and most are insurance agents, making Valic a fee-based firm.

As of December 31, 2014, Valic had more than $86 billion in total customer assets under management, ranking in the top 10 of all U.S. and Canadian life insurance companies. Valic manages plans for nearly 24,000 groups, serving over 2 million plan participants in 41,000 locations across the U.S.

In December 2017, Valic reported having more than $100 billion in total assets, managing plans for nearly 23,000 groups and serving approximately 1.8 million participants.

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