Our Firm
PGIM DC Solutions LLC (“PGIM DCS”) is a registered investment adviser with the SEC and organized as a
Delaware limited liability company.
PGIM DCS was formed on September 28, 2021, and is a direct, wholly-owned subsidiary of PIFM Holdco LLC,
which is an indirect, wholly-owned affiliate and subsidiary of Prudential Financial, Inc. (“Prudential Financial”),
a publicly held company (NYSE Ticker "PRU").
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PGIM DCS launched its business in 2022 and is the retirement solutions provider of PGIM, Prudential
Financial’s global investment management business. PGIM DCS offers pre-retirement and post-retirement
solutions for defined contribution plans. PGIM DCS’ goal is to deliver innovative defined contribution solutions
founded on market-leading research and capabilities. PGIM DCS’ team of professional experts has many years
of experience in the DC solutions space and the team’s expertise spans across plan design and participant
engagement, investment best practices, portfolio construction, retirement income, and the regulatory and
legislative environment.
This brochure describes PGIM DCS’ business, and hereinafter when we use the terms “we,” “us” and “our,” we
are referring to PGIM DCS unless we specify otherwise.
Our Advisory Business in General
PGIM DCS provides advisory services for participants in defined contribution plans in the United States. These
services include managed accounts (“Managed Accounts”), point-in-time advice (“Advice Program”), target date
portfolios (“Target Date Portfolios”) and retirement spending portfolios (“Retirement Spending Portfolios“). The
Target Date Portfolios and Retirement Spending Portfolios are referred to collectively herein as the “Retirement
Portfolios”. PGIM DCS will also offer technology services.
Managed Accounts
Under the Managed Accounts program, PGIM DCS will provide participants with a personalized retirement
strategy. This strategy will be based on the participant’s personal and financial data which is derived from the
information provided by the participant, plan provider, and/or plan sponsor. Depending upon the participant’s
life stage, the strategy may include a retirement income goal, recommended savings rate, recommended
retirement age, retirement income projection, retirement spending guidance, guaranteed income allocation,
asset allocation target and investment allocation. Such components of the personalized retirement strategy
are designed to assist participants to meet their retirement goals.
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Prudential Financial, Inc. of the United States is not affiliated in any manner with Prudential plc, a company incorporated in the
United Kingdom or with Prudential Assurance Company, a subsidiary of M&G plc, incorporated in the United Kingdom.
A participant who has chosen to participate in a Managed Account program will enter into an advisory
agreement with PGIM DCS. Once a participant enrolls in the Managed Accounts program and enters into the
advisory agreement, PGIM DCS will send instructions to the plan provider or plan sponsor in order to
implement the retirement strategy assigned to the participant. PGIM DCS will not seek a participant’s consent
prior to implementing the investment portfolios.
The PGIM DCS Managed Accounts program is discretionary in nature and PGIM DCS acts as an “investment
manager” within the meaning of Section 3(38) of ERISA and is a fiduciary within the meaning of Section 3(21)
of ERISA and Section 4975(e)(3) of the Internal Revenue Code of 1986 as amended (the “Code”).
The Managed Accounts program uses investment options, including commingled vehicles such as mutual funds
and CITs, available in the plan. Some plans may include among their investment options Prudential-affiliated
investment funds (e.g., mutual funds, exchange-traded funds (“ETFs”), CITs) (“Proprietary Funds”) or
guaranteed income products (“Proprietary Income Options”) (Proprietary Funds and Proprietary Income
Options, collectively, “Proprietary Products”). These investment options are chosen by the plan provider, plan
sponsor or another party selected by the plan sponsor. PGIM DCS has no role in the selection of these
investment options.
These investment options are used in order to create investment portfolios designed for participants across a
range of risk exposure levels. Under certain circumstances, investment portfolios will be constructed and
assigned to individual participants by an independent financial expert (“IFE”), as described below, with PGIM
DCS’ discretion over the Managed Accounts limited to implementing the IFE’s advice, which PGIM DCS does
not have the authority to modify. Under other circumstances, PGIM DCS may not engage an IFE for portfolio
construction and assignment.
The IFE, as applicable, generally on a quarterly basis, will assess the Managed Accounts and determine
whether rebalancing or reallocation is needed. Assessments may be performed on an other-than-quarterly
basis under certain circumstances, such as unusual market conditions (e.g., volatility) and other unforeseen
circumstances, substantial cash flow into or out of accounts, or if a participant provides additional or updated
information about his or her personal or financial situation that affects the participant’s retirement strategy. If
the IFE determines that rebalancing or reallocation is needed, PGIM DCS will send transaction instructions to
the plan provider or plan sponsor to rebalance or reallocate the Managed Account in accordance with advice
provided by the IFE. Participants will also receive quarterly and annual review reports of their investments and
progress towards their retirement goals.
A plan sponsor may elect to have participants automatically enrolled into Managed Accounts program described
above. The plan sponsor will enter into an advisory agreement with PGIM DCS and direct PGIM DCS to enroll
participants in appropriate investment portfolios based on a participant’s personal and financial data which is
obtained from the information provided by the plan sponsor or plan provider. This type of plan sponsor directed
enrollment may be designated as a qualified default investment alternative (“QDIA”), as permitted under the
Employee Retirement Income Security Act (“ERISA”). It is the plan sponsor’s responsibility to select the QDIA
for plan participants, including the responsibility to determine the quality of the QDIA and reasonableness of
fees.
In such scenario, plan participants will receive written notice of the directed enrollment process from the plan
sponsor. They will be provided with an opportunity to opt-out of the program, as determined by the plan sponsor.
If they opt out of the program, they will not incur any fees or penalties.
Participants can further personalize the advice and provide additional or updated information via the Managed
Accounts participant website and receive a retirement strategy based on the updated data. Reallocation and/or
rebalancing will be conducted as described above.
Upon termination of the advisory agreement by either the plan sponsor or participant, the account holder’s
assets will remain invested in the Managed Accounts investments last allocated by PGIM DCS until the
participant makes changes to those allocations.
Advice Program
Under the Advice Program, a participant will receive a point-in-time recommendation i.e., the participant’s
account is not monitored, reviewed, or updated on an ongoing basis to provide an updated retirement strategy.
Once a participant receives such point-in time recommendation, the advisory relationship between the
participant and PGIM DCS ends. The participant may return at any time to receive a new retirement strategy.
Under the Advice Program, PGIM DCS is a fiduciary under Section 3(21)(a)(ii) of ERISA and Section
4975(e)(3)(B) of the Code.
Similar to the Managed Accounts program, PGIM DCS will provide a participant with a personalized retirement
strategy. This strategy will be based on the participant’s personal and financial data which is obtained from
information provided by the participant, plan provider, and/or plan sponsor. Depending on the participant’s life
stage, the advice may include a retirement income goal, recommended savings rate, retirement age,
retirement income projection, retirement spending guidance, guaranteed income allocation, asset allocation
target and investment allocation. Such components of the personalized retirement strategy are designed to
assist participants to meet their retirement goals.
Similar to the Managed Accounts program, the Advice Program uses investment options, including
commingled vehicles such as mutual funds and CITs, available in the plan. These investment options are
chosen by the plan provider, plan sponsor or another party selected by the plan sponsor. PGIM DCS has no
role in the selection of these investment options. As described above under the “Managed Accounts” section,
some plans may include
among their investment options Proprietary Products.
As with the Managed Accounts program, the under certain circumstances, PGIM DCS may engage an IFE
that will use the investment options in order to create investment portfolios designed for participants across a
range of risk exposure levels. When applicable, these investment portfolios will be constructed and assigned
to individual participants by the IFE, as described below.
Independent Financial Expert (IFE)
Under certain circumstances, PGIM DCS will engage an Independent Financial Expert (“IFE”) with respect to
its Managed Accounts and Advice programs, as defined in the SunAmerica Opinion (Department of Labor’s
Advisory Opinion 2001-09A dated December 14, 2001). PGIM DCS’ use of an IFE is one approach to seek to
avoid potential ERISA prohibited transactions for plans which are governed by ERISA. PGIM DCS is
responsible for the selection and ongoing monitoring of the IFE.
When applicable, the IFE will have full authority and responsibility to develop investment portfolios for plans
participating in the Managed Accounts and Advice programs and to assign participants to an appropriate
investment portfolio. The IFE will provide services directly to PGIM DCS and does not have a contractual
relationship with the plan sponsor. PGIM DCS will pay all fees and expenses charged by the IFE for its services.
As described below, when applicable, the IFE develops asset allocation models which will serve as the basis
for constructing investment portfolios for each plan offering the Managed Account and Advice Programs to its
participants. The allocation models contain differing proportions of equity, fixed income and other asset classes
with a broad range of risk tolerance levels (the “Allocation Models”).
For each plan participating in the Managed Accounts and Advice programs, the IFE, as applicable, selects and
combines investment options available under the plan in order to construct a set of fund-specific investment
portfolios so that the total asset class exposures of those investment options equal the asset class weights of
the corresponding Allocation Model.
When applicable, PGIM DCS will provide the IFE with sample asset allocation models (“Allocation Models”)
that the IFE may choose, in its discretion, to use, modify, or not use as the allocation models for the plans
participating in the programs. PGIM DCS includes with the Allocation Models any information that the IFE may
need to understand the investment principles and assumptions reflected in the Allocation Models. The IFE is
not required to adopt the Allocation Models provided by PGIM DCS.
In order to consider the appropriate investment portfolio to a participant, PGIM DCS is building an “Assignment
Tool” which is based on a proprietary algorithm developed by PGIM DCS. An algorithm is essentially a set of
rules or instructions for solving a problem or transforming data input into data output. Here, in order to identify
an appropriate allocation model for a participant (the output), the Assignment Tool takes into account various
inputs, including information about the individual participant such as, but not limited to, age, salary, plan
account balance, company match and risk tolerance.
The Assignment Tool also makes certain assumptions regarding future investment returns and inflation rates.
Please refer to Item 8 (Methods of Analysis, Investment Strategies and Risk of Loss) below for more
information about the Assignment Tool and the data it collects and analyses from participants. When
applicable, the IFE will be responsible for evaluating the investment methodologies and principles on which
the Assignment Tool is based and determining whether to utilize it in connection with the Managed Accounts
and Advice programs.
When applicable, the IFE will be responsible for confirming that plans offering the Managed Accounts and/or
the Advice program have sufficient investment options within their investment line-ups to satisfy the asset
allocation needs of the investment portfolios and will communicate directly with the plan if additional
investment options must be added to support the programs. PGIM DCS will not participate in or influence this
evaluation or any corresponding recommendations that may make to the plan sponsor.
Retirement Portfolios (Target Date Portfolios and Retirement Spending Portfolios)
As mentioned above, PGIM DCS’ advisory business includes investment management and asset allocation
services with respect to Retirement Portfolios that are (or may be, in the future) offered in multiple pooled
vehicle structures, including mutual funds, collective investment trusts (CITs), and insurance company separate
accounts (of affiliated and unaffiliated insurance companies).The Target Date Portfolios are established as
funds-of-funds and they invest in passive and actively managed commingled vehicles (which include mutual
funds, insurance company separate accounts, and CITs). The majority of these mutual funds and CITS are
advised by affiliates of PGIM DCS. Similarly, the Retirement Spending Portfolios are also established as funds-
of-funds which invest in mutual funds (including ETFs) that are primarily advised by affiliates of PGIM DCS but
may also include mutual funds and ETFs that are not advised by such affiliates.
The Target Date Portfolios invest in underlying vehicles which allocate assets to multiple asset classes including
equity and fixed income, real estate, commodities and also may invest in certain other non-traditional asset
classes. The asset allocation of each Target Date Portfolio follows a glidepath that becomes more conservative
prior to, and for approximately ten years following, the target date by reducing exposure to equity investments
and increasing exposure to fixed income assets (the “Glidepath”).
The Retirement Spending Portfolios are also fund-of-funds and are structured as mutual funds (primarily
affiliate). Similar to the Target Date Portfolios, the Retirement Spending Portfolios invest in underlying vehicles
(including affiliated and unaffiliated mutual funds) which allocate assets to multiple asset classes of fixed income
and equity securities and non-traditional asset classes. The portfolios are targeted towards funding a certain
type of spending styles in retirement, relying on varying participant demographic assumptions. The ability for
participants to meet their spending goals, which we have separated into “Needs and Wants” liabilities, are
dependent on a number of holistic factors including both in plan and out of plan items which influence our
strategy modeling process.
Recognizing that individuals have different situations and preferences, the Retirement Spending Portfolios are
offered in three distinct portfolios, which have been constructed to address the varying spending styles of
individuals. The portfolios range from a greater focus on “Needs” spending to a greater focus on “Wants”
spending, resulting in different investment risk profiles.
Technology Only Offerings/Services to Unaffiliated Managers or IFEs
As previously described, PGIM DCS is building a proprietary Assignment Tool where the individual participant
will input individual information and parameters and a glidepath or model portfolio will be generated.
It is anticipated that PGIM DCS may be engaged to provide assistance to unaffiliated investment managers or
IFEs responsible for recommending or selecting investment portfolios for the investment of participant accounts.
In these cases, PGIM DCS will not serve as an ERISA fiduciary or Section 3(38) investment manager and will
have no responsibilities for the implementation of investment decisions for the participant accounts.
In this offering, PGIM DCS would simply provide financial and investment information, including sample
Allocation Models and may permit the unaffiliated manager or IFE to use its Assignment Tool. As it will do in
connection with the Managed Accounts program, PGIM DCS will provide to the manager or IFE sufficient
information about the Allocation Models and the Assignment Tool to permit the manager or the IFE to evaluate
the information, assumption and methodologies reflected therein.
Customization of our Advisory Services
For the Managed Accounts and Advice Programs, a participant that chooses to participate in either program
will not have the opportunity to negotiate the agreement. The agreement will be a standard agreement similar
to other agreements utilized in the industry for these types of programs. For the Retirement Portfolios, our
sub-advisory agreements are negotiated with, and go through an approval process by, the advisors/trustees
of the Retirement Portfolios. Such sub-advisory agreements are negotiated to incorporate mutually acceptable
terms.
Our Assets Under Management
As of December 31, 2023, our:
• Discretionary assets under management (rounded to the nearest million) were: $1,260,159,540
• Non-discretionary assets under advisement (rounded to the nearest million) were: $0