Vanguard’s How America Saves report for 2022 provided cause for optimism with some of its findings. For example, employee participation rates in Vanguard-managed defined contribution plans remain high, and have not declined year-over-year during the pandemic. The majority of participants in Vanguard plans also increased or maintained their contributions last year, and the average account balance for Vanguard participants increased by 10% year-over-year, to $141,542.

Selecting an automatic rollover IRA provider used to be easy.

Most 401(k) plan sponsors simply accepted the solution offered through their recordkeeper or TPA. Others performed due diligence, using a limited set of criteria including basic fees, investment options and accountholder service.

Over the past 15 years, a very large (250,000+ participants) 401(k) plan sponsor that our company has had the opportunity to serve has been highly successful in delivering improved participant outcomes by incrementally adopting a full program of retirement savings portability.

Were the plan’s experience set to music, it could be described as “401(k) Portability in Four Movements” – opening with discordant levels of cashout leakage but quickly building towards more satisfying participant outcomes, including substantial improvements in the preservation and consolidation of retirement savings.

An interesting and valuable finding lies buried within EBRI’s 2022 Retirement Confidence Survey (RCS), but you won’t find it referenced in the organization’s initial report, officially released to the public on Thursday, April 28^th.

In an excerpt of a report available to survey partners, the RCS found that a plurality of job-changing 401(k) plan participants favored automatic plan-to-plan portability over consolidating their savings to an IRA, or leaving their savings behind in their former employer’s plan. This result comes on the heels of EBRI’s 2021 survey, which found that nearly 9 in 10 participants believed that auto portability would be valuable to them.

In general, legislation that gets more Americans saving for retirement is good. But if a great many of those incremental savers would likely cash out their savings immediately following a job change, then the public policy benefits might fall a bit short, no?

With $10 trillion in 401(k) and other defined contribution retirement assets to safeguard, retirement industry regulators are intensely focused on the issue of cybersecurity.

The latest developments signifying regulatory resolve include enforcement actions by the Securities and Exchange Commission (SEC), who in August 2021 sanctioned 8 firms in three separate actions (links here, here and here), for failing to have cybersecurity policies and procedures in place, potentially leading to compromised private client data. 

“America’s retirement system is sustainable” said no one, ever.

That’s the basis for my somewhat cynical reaction to a February 14^th, 2022, Request for Information (RFI) issued by the DOL’s Employee Benefits Security Administration (EBSA). The RFI (Request for Information on Possible Agency Actions to Protect Life Savings and Pensions from Threats of Climate-Related Financial Risk) was issued pursuant to a May 20^th, 2021 Executive Order, and asks respondents to identify climate change related threats to “the life savings and pensions of U.S. workers and families.”

I’m old enough to remember a time when auto portability was a concept, scarcely worthy of serious attention by practically anyone except a few zealots with an idea.

For years, regulators, policymakers and, of course, 401(k) plan sponsors have struggled with the vexing problems of missing participants, uncashed distribution checks and small, forgotten accounts. Every year, sponsors beseech regulators for clear guidance to mitigate their fiduciary risk, while lawmakers propose policies such as lost and found registries to help deal with the problems. Yet, the problems persist and have grown worse over time, even accelerating recently due to The Great Resignation.

On 12/6/21, the Employee Benefit Research Institute (EBRI) conducted day 1 of their two-day 90^th Annual Public Policy Forum.  This forum’s theme was “A Path to a More Equitable Solution: Solving the Retirement Coverage Gap” and it seems to have been highly popular, as it broke EBRI’s previous record for forum attendance.