Charles Schwab's annual survey reveals that retirement savings confidence among 401k participants is declining, primarily due to inflation, which is a concern for 57% of respondents. The percentage of participants feeling "very likely" to meet their savings goals has dropped from 43% to 34%. Despite financial challenges, most 401k investors are not cutting their contributions; only 11% have reduced them. Instead, many are adjusting their spending habits by making fewer purchases (40%) and opting for cheaper products (39%). Additionally, the use of 401k loans and hardship withdrawals has decreased from 26% to 21% over the past year.
A federal judge has dismissed a lawsuit alleging fiduciary breach related to the use of plan forfeitures to offset employer contributions. The defendants, Siemens Corp., argued in their October 2024 motion that the plaintiff's claims represented a "novel and untenable theory" contrary to established ERISA rules concerning defined contribution plans. The plaintiff claimed that the defendants had discretionary control over the distribution of plan forfeitures, mirroring issues raised in numerous similar cases.
While much attention is given to the "retirement crisis" concerning participant savings shortfalls, there is a significant, often neglected issue: a lack of accessible, quality retirement advice. As participants increasingly rely on defined-contribution plans, many lack the necessary skills or time to effectively manage their savings and investments. This advice gap can lead to uncertainty for participants regarding their retirement planning. Plan sponsors have the opportunity to help address this gap by offering essential services to support participants in achieving their retirement goals.
As a plan provider -- whether you're an advisor, TPA, recordkeeper, or pooled plan provider -- you've likely encountered the familiar advice to "create content that keeps you top of mind with plan sponsors." But what type of content truly resonates? The key is that plan sponsors are not interested in dense white papers filled with technical jargon. Instead, they prefer practical, easy-to-understand materials that answer the question, "What should I know or do now?" Here are five effective types of content you should be producing.
Forfeitures in 401k plans, often overlooked, are now gaining attention due to recent class-action lawsuits targeting how plan sponsors handle these funds. Traditionally, many plans have used unvested employer contributions leftovers from early-leaving employees to offset future contributions, following IRS guidance. However, some lawsuits argue that this practice could breach ERISA's fiduciary standards. While the outcome of these legal challenges is uncertain, plan sponsors and fiduciaries should proactively review their procedures regarding forfeitures.
A pooled plan provider is designated in a retirement plan as a fiduciary under ERISA, responsible for administration and ensuring compliance with ERISA and Internal Revenue Code requirements. The Department of Labor has provided guidance for small business owners to help them select a pooled employer plan, offering important questions to consider during the selection process.
A federal judge has approved a $69 million settlement in a class action lawsuit against UnitedHealth Group regarding its 401k plan. Plaintiffs alleged that the company violated fiduciary duties under ERISA by keeping poorly performing Wells Fargo target date funds in the plan. Judge R. Tunheim of the U.S. District Court of Minnesota confirmed he would sign the proposed orders with no major changes in the case of Snyder v. UnitedHealth Group, et al.
In 2022, the U.S. Department of Labor under former President Joe Biden cautioned fiduciaries against including cryptocurrency options in 401k plans due to their risks. However, this guidance was rescinded in May 2025. Following this change, four prominent Democratic Senators are urging DOL Secretary Lori Chavez-DeRemer to acknowledge the extreme volatility of cryptocurrency and its inappropriateness as a retirement investment.
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Collected Wisdom™
Our researchers look for what they think are some of the better resources available to assist you in administering your plan or helping your clients. We group these resources in our COLLECTED WISDOM™ topics to make it easy for you to locate the information you need. Each item in a category contains a summary and date of when it was placed in the group.
We also maintain some older material in these collections for perspective and context.
