--- title: "The One Solution Everyone in DC Agrees Upon: We Need Consolidation" description: "There’s one topic that everyone in Washington, D.C. seems to agree upon: the importance of consolidation in protecting Americans’ retirement security." image: http://blog.rch1.com/hubfs/Set_Up_Images/Other_Generic_Images/washingtonDCnight.jpg --- [![Retirement Clearinghouse Logo](https://blog.rch1.com/hs-fs/hubfs/raw_assets/public/Retirement_Clearinghouse_May2022/images/logo.png?width=1000&height=648&name=logo.png "Retirement Clearinghouse Logo")](https://rch1.com/) [Privacy Policy](https://securities.rch1.com/common/PrivacyStatement.pdf) [Sponsors/Service Providers](https://rch1.com/plan-sponsors) [Individuals](https://rch1.com/individuals) [Login](https://rch1.com/#) - [Home](https://rch1.com/home-page) - [Individuals](https://rch1.com/individuals) - [Individuals Home](https://rch1.com/individuals/individuals-home) - [Who is RCH?](https://rch1.com/individuals/who-is-rch) - [Why Does RCH Have My Retirement Savings?](https://rch1.com/individuals/why-does-rch-have-my-retirement-funds) - 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[Careers - Job Opportunities](https://rch1.com/company/careers) - [Our Benefits](https://rch1.com/company/our-benefits) - [The RLJ Companies](https://rch1.com/company/the-rlj-companies) - [News & Information](https://rch1.com/news) - [News](https://rch1.com/news) - [Press Releases](https://rch1.com/press-releases) - [Thought Leadership](https://rch1.com/thought-leadership) - [Consolidation Corner Blog](https://rch1.com/blog) - [Consolidation Corner Channel](https://rch1.com/consolidation-corner-channel) - [Events](https://rch1.com/events) - [Auto Portability](https://rch1.com/auto-portability) # The One Solution Everyone in DC Agrees Upon: We Need Consolidation #### [By Neal Ringquist](https://blog.rch1.com/blog/author/neal-ringquist) | September 22, 2016 ![Washington DC at night](http://blog.rch1.com/hs-fs/hubfs/Set_Up_Images/Other_Generic_Images/washingtonDCnight.jpg?width=200&name=washingtonDCnight.jpg "Washington DC at night")This summer, there’s one topic that everyone in Washington, D.C. seems to agree upon: the importance of consolidation in protecting Americans’ retirement security. **EBRI/ICI Research Points to Consolidation** On September 8th, [EBRI](https://www.ebri.org/) and [ICI](https://www.ici.org/) jointly released the study “[What Does Consistent Participation in 401(k) Plans Generate? Changes in 401(k) Account Balances, 2010–2014](https://www.ici.org)” -- describing the significant, positive impact that consistent plan participation has on participants’ 401(k) account balances. The study revealed that the median account balance of “consistent” participants – the 8.8 million participants who maintained participation and steady contributions from 2010-2014 – was **more than three times** the median balance across all participants at year-end 2014.  Behind the study’s marquee numbers lies a hidden gem: job tenure for “consistent” participants was significantly higher than the job tenure for all participants.  Multiple studies have demonstrated that [high cashout rates occur](https://blog.rch1.com/blog/fast-and-slow-leakage-produce-a-flood-of-outflows) as participants change jobs.  Thus, consolidation programs (ex. – [Auto Portability](https://rch1.com/auto-portability/frequently-asked-questions)) could bridge this “tenure gap” – in effect, generating “synthetic tenure” by seamlessly moving balances forward when participants change plans. The tenure gap is expected to worsen as the phenomenon of the “gig” economy accelerates, increasingly necessitating a [system of portable retirement savings](http://www.natlawreview.com/article/moving-toward-system-portable-benefits-gig-economy). **The Bipartisan Policy Center Weighs in on Consolidation** When it comes to consolidation, the Bipartisan Policy Center certainly agrees.  The BPC’s views emanate from a 19-member [Commission on Retirement Security and Personal Savings](http://bipartisanpolicy.org/commission-on-retirement-security-and-personal-savings/), which has “carefully reviewed the issues and explored many potential approaches that would boost savings and strengthen retirement security” -- reached bipartisan consensus on the most critical initiatives that should move forward. During their 9/7 [testimony](http://www.aging.senate.gov/hearings/watch?hearingid=DA98F48E-5056-A066-60A2-B6242C6530EE) before the [Senate Committee on Aging](http://www.aging.senate.gov), former Senator Kent Conrad (D-ND) stated: *“Finally, we recommend the creation of a Retirement Security Clearinghouse to ease the process of consolidating retirement plans.  Let me just say, after leaving the Senate, one of things I did was turn some attention to our own financial situation…my wife’s and mine.  And what I found is that I’ve got accounts here…drib-drab…over here…you know, a little account over there.  Most Americans face the same thing, and it would be a tremendous advantage if we were able to consolidate these plans.”* **The ERISA Advisory Council Takes Up Account Consolidation** Finally, this summer the Department of Labor’s [ERISA Advisory Council](https://www.dol.gov/agencies/ebsa/about-ebsa/about-us/erisa-advisory-council) (EAC) heard expert testimony from 19 witnesses on the issue of [Participant Plan Transfers and Account Consolidation for the Advancement of Lifetime Plan Participation](https://www.dol.gov/sites/default/files/ebsa/about-ebsa/about-us/erisa-advisory-council/2016-participant-plan-transfers-and-account-consolidation-scope-statement.pdf), which served to reinforce the critical role that consolidation will play. [Retirement Clearinghouse](http://www.rch1.com) and EBRI teamed up to [testify on the effectiveness of Auto Portability](https://www.dol.gov/sites/default/files/ebsa/about-ebsa/about-us/erisa-advisory-council/copeland-written-statement-060816.pdf) at plugging leakage for small-balance participants, followed by [testimony from Warren Cormier of Boston Research Technologies](https://www.dol.gov/sites/default/files/ebsa/about-ebsa/about-us/erisa-advisory-council/cormier-written-statement-082316.pdf) on proven, behaviorally-based solutions that promote lifetime plan participation. Over the coming weeks, we'll eagerly await the [EAC’s final report](https://www.dol.gov/agencies/ebsa/about-ebsa/about-us/erisa-advisory-council/reports) on this topic, which we expect will make a significant contribution towards advancing the adoption of programs that consolidate retirement savings. 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