Insights: Trends, Research, Analysis, and White Papers

Five Innovative Ways Organizations Can Use AI to Improve Their Retirement Plans

As employee benefits continue to change, artificial intelligence is becoming a transformative force in the realm of 401k and other retirement plans. By harnessing AI, companies can significantly improve retirement planning and boost employee engagement through innovative methods. Here are five compelling strategies for retirement plan sponsors to embrace AI and enhance their employee benefits programs.

Source: Alight.com, September 2025

Want to be Highly Valued by Plan Sponsors? Improve Participant Outcomes

Fidelity Investments' 16th annual Plan Sponsor Attitudes Study reveals a strong correlation between plan sponsors' satisfaction with retirement plan advisors and their perception of employees' retirement readiness. The study, which surveyed over 1,100 employers, found that 74% of sponsors who believe participants are saving adequately for retirement express high satisfaction with their advisors, compared to only 58% for those who think otherwise. Christopher Alpaugh from Fidelity highlights that advisors play a crucial role in helping sponsors navigate complexities and enhance participant outcomes.

Source: 401kspecialistmag.com, September 2025

The 2025 Advisors' Choice Top Recordkeepers

Which recordkeepers truly excel in the industry? Who offers the most exceptional services, support, products, and processes? Advisors, with their broad experience across different market segments and plans of varying sizes, are uniquely qualified to assess the wide array of available options. NAPA reached out to advisors to evaluate various service categories across five distinct market segments. They were asked to provide their insights solely on the services relevant to their target markets and to rate them on a five-point scale, ranging from "world-class" to "functional" and "needs work." Based on their evaluations, NAPA identified the top five recordkeepers in each of the five market segments categorized by size.

Source: Napa-net.org, September 2025

2025 Retirement Analysis: Retirement Account Balances Reach New Record High, Rebounding From Dip in Q1

Fidelity Investments' Q2 2025 retirement analysis reveals record-high average balances for 401k, 403b, and IRA accounts. Factors contributing to this growth include consistent saving habits and strong stock market performance, despite earlier market volatility. Compared to Q2 2024, the average 401k balance rose by 8%, the 403b balance by 9%, and the IRA balance by 5%.

Source: Fidelity.com, September 2025

Safe Harbor 401k Plan: 2025 Trends to Know

Safe Harbor 401k plans are increasingly popular among businesses as a reliable and advantageous retirement option. These plans allow employers to bypass certain IRS compliance tests while providing competitive benefits. With new incentives, features, and concerns about economic conditions and state regulations, Safe Harbor plans are viewed as a strategic tool that not only enhances employee engagement but also boosts business profitability, making them a preferred choice for many employers.

Source: Myubiquity.com, September 2025

403b Plan Participants Benefit From Employer Contributions and Diverse Investment Choices

A report by the Investment Company Institute and ISS Market Intelligence reveals that a majority of employees in large ERISA 403b plans benefit from employer contributions, enhancing their long-term retirement security. According to the 2022 ICI/ISS MI Defined Contribution Plan Profile, 85% of large ERISA 403b plans, which cover most participants, received employer contributions in 2022. Employer contributions have consistently been a significant source of funding for these plans over the past decade. Among plans with employer contributions, 33% offered automatic contributions, 56% provided simple matches, and 13% included both features, while 23% featured tiered matches and other contribution types.

Source: Ici.org, September 2025

A New Look at Designing ERISA Retirement Plans

In recent decades, private-sector employers have moved away from traditional DB plans that provided guaranteed lifetime income, opting instead for DC plans that focus on asset accumulation. This transition has reduced employer liabilities but left many retirees struggling to convert their savings into a reliable income. Although retirees value lifetime income options, attempts to integrate insured income products into DC plans have faced challenges. As workforce demographics and retirement expectations change, there is a need for new retirement plan designs that provide predictable lifetime income for retirees while managing risks for employers. However, the ERISA DB-DC classification requirement can hinder innovative plan designs, especially when a plan doesn't fit neatly into either category.

Source: Actuary.org, September 2025

Implications of Demographic Shifts for Retirement Plan Sponsors

Diana Schneider from Massachusetts Mutual Life Insurance Company discusses how shifting demographics in the U.S. are impacting retirement planning and the role of plan sponsors. She notes that increasing longevity and generational behavior changes are reshaping attitudes towards aging and careers. Schneider identifies three key implications for employers regarding these evolving retirement dynamics. These insights suggest that plan sponsors need to adapt their strategies to better support participants in retirement planning as the nature of retirement continues to change.

Source: Plansponsor.com, August 2025

Selecting Plan Features That Appeal to Younger Employees

Company culture and workplace benefits are evolving to meet the needs of younger generations in the workforce. To attract and retain young talent, companies must adapt their benefit programs, particularly in the area of company-sponsored retirement savings plans. Younger workers are increasingly reliant on their savings for financial security, rather than relying solely on Social Security. Additionally, they value features that address their specific needs, like student loan debt assistance, and investments that align with their social values. Recommendations are provided for benefits that would appeal to this demographic.

Source: Planpilot.com, August 2025

Trump Seeks to Encourage PE and Crypto 401k Plan Investments

President Trump's Order aims to promote access to alternative assets in 401k plans, marking a significant change from the previous administration. The potential for broader inclusion of these investments will hinge on agencies creating clear and certain fiduciary guidelines for plan fiduciaries. These guidelines must also withstand judicial scrutiny. Furthermore, alternative investment firms should evaluate the effects of 401k participant investments, which are protected under ERISA.

Source: Erisalitigation.com, August 2025

Growing Advisor Support for Private Market Investments in Retirement Plans: Survey

A recent survey by Empower reveals strong interest among financial advisors in incorporating private market investments, such as private equity, real estate, and credit, into defined contribution portfolios. The July 2025 survey found that 68% of advisors already use these investments, mostly in high-net-worth accounts. Notably, 58% of those who use private market investments would recommend them for retirement plans, a figure that rises to 75% among advisors serving pension plans. Overall, 43% of advisors show increasing interest in this area.

Source: Empower.com, August 2025

Debt Weighs Heavy on Plan Sponsors, Employees

A comprehensive assessment of financial wellness must consider debt. Recently, a Texas federal judge approved the Trump administration's request to eliminate regulations from the Biden administration that aimed to remove $49 billion in medical debt from the credit reports of almost 15 million consumers. Additionally, interest on student loans resumed on August 1 for 7.7 million borrowers in the income-driven Saving on a Valuable Education Plan, following a ruling by the U.S. 8th Circuit Court of Appeals that struck down the program in April. "For employers, this isn't really just a credit issue," says Todd Lacey, president of Financial Finesse. "It's a wellness issue."

Source: Plansponsor.com, August 2025

Why Do Small Businesses Rarely Claim Tax Credits for Offering Retirement Plans?

U.S. policymakers have introduced various incentives to increase retirement plan coverage in the private sector, especially for small businesses, notably through the Section 45E tax credit, which helps cover the costs of establishing and managing employer-sponsored retirement plans. However, a new study indicates that take-up of this credit is very low, with fewer than 6 percent of eligible firms claiming it even in recent years. The study, based on detailed IRS data, suggests that the likelihood of claiming the credit is influenced significantly by the characteristics of firm owners and their tax preparers, pointing to potential informational and behavioral barriers that affect decision-making.

Source: Georgetown.edu, August 2025

Mobile, AI, and Beyond: Trends and the Future of Retirement Plan Participant Experiences

The retirement industry is at a crucial point in its digital evolution, with recordkeepers under significant pressure to deliver seamless, personalized digital experiences that meet the rising expectations of plan sponsors and participants. These expectations are shaped by the user-friendly websites and apps individuals encounter in their everyday lives. Digital experiences are becoming a key factor in Requests for Proposals, dramatically impacting firms' financial performance. While top recordkeepers have made substantial investments to enhance their digital offerings and have seen improvements, many still struggle to keep pace with evolving user experience standards and digital trends. The author shares his insights on where the retirement plan industry's digital experiences are heading and what trends and insights recordkeepers need to know to stay competitive.

Source: Corporateinsight.com, July 2025

Evaluating Private Market Investments in Retirement Plans: Podcast

Jennifer Doss and Matt Patrick from CAPTRUST are joined by Lucian Marinescu and Josh Charlson from Morningstar to discuss the increasing integration of private market investments in defined contribution plans. They delve into potential allocation strategies, operational hurdles, and the practical considerations for plan sponsors, including issues related to fees, liquidity, and valuation transparency. Lucian and Josh also provide valuable insights on the need for fiduciary due diligence, the significance of transparency, and the key factors that sponsors should assess before adding private market strategies to their retirement plan offerings.

Source: Captrust.com, July 2025

Mutual Fund Expense Ratios Remain at Historic Lows for Retirement Savers

Research from the Investment Company Institute published today shows that retirement savers in 401k plans experienced historically low average mutual fund expense ratios for yet another year. The ICI's latest report, "The Economics of Providing 401k Plans: Services, Fees, and Expenses, 2024," highlights a dynamic and competitive market for mutual funds in 401k plans, offering millions of American workers an affordable option for retirement savings.

Source: Prnewswire.com, July 2025

Growth in Micro 401k Plan Market Piques Advisor and Recordkeeper Interest

The small and micro 401k plan segments are projected to grow significantly in the coming years, driven by incentives from SECURE 2.0 and state mandates aimed at increasing retirement savings coverage. Cerulli anticipates that the number of 401k plans will exceed one million by the end of the decade, marking a 36% increase over the next five years. This information is outlined here.

Source: Cerulli.com, July 2025

Retirement Security Improved by Allocating a Portion of DC Plan Assets Into Annuities

A recent paper from the National Bureau of Economic Research proposes a solution to address longevity risk among retirees by defaulting 20% of a retiree's assets above a certain threshold into an immediate annuity. This approach aims to alleviate concerns that financially inexperienced retirees may overlook guaranteed lifetime income options. The research, conducted by professors Vanya Horneff, Raimond Maurer, and Olivia Mitchell, suggests that such automatic allocation could enhance retirement security for many participants, particularly benefiting college graduates if the annuity is deferred until age 80.

Source: Planadviser.com, July 2025

Plan Sponsors Shift Priorities to Cybersecurity, AI

A recent Escalent report highlights that fewer defined contribution plan sponsors are prioritizing cost reduction. Only 40% of plan sponsors identified decreasing costs as a key focus for the upcoming year, down from 50% in 2024. Instead, attention is shifting towards cybersecurity and artificial intelligence due to increasing concerns about data breaches and cyberattacks. The report reveals that 70% of plan sponsors and 10% of large-mega plans experienced a 401k-related data breach in the past year. Cybersecurity threats were reported as the primary concern for 52% of surveyed sponsors, surpassing worries about underperforming investment options (45%) and inadequate employee retirement savings (43%).

Source: 401kspecialistmag.com, July 2025

What Can the DC Universe Learn From Annuities in 403b Plans? It's Complicated

The defined contribution community commonly recognizes the complexity of annuities, with over half of plan sponsors in a January 2024 Greenwald Research survey stating that they find annuities too complicated. This complexity encompasses not only the functionality and costs of the products but also determining the most suitable options and understanding participant demand. As DC plan sponsors weigh their options -- ramping up promotion of existing annuities or developing new ones in response to shifting demand and loosened rules -- they would do well to examine how annuities have long been used in 403b plans. But the lessons there, too, are nuanced.

Source: Plansponsor.com, July 2025

Top 10 Benefits-Related Impacts of the One Big Beautiful Bill Act

On July 4, 2025, President Trump signed the One Big Beautiful Bill Act, which includes various tax incentives for paid family leave, employer-provided child care, telehealth services, and education benefits. The act makes several tax credits from the Tax Cuts and Jobs Act of 2017 permanent, which may encourage more employers to offer related benefits. The article highlights key aspects of the budget reconciliation package relevant to employers and benefit plan sponsors.

Source: Ifebp.org, July 2025

Things I Worry About: Private Funds and 401k Plans

The private fund industry is seeking to gain access for its funds to be included in 401k plans. While a discussion on the benefits of private fund investments is more suited for investment professionals rather than legal experts, there are significant legal considerations under ERISA that affect the inclusion of these investments in participant-directed plans. This article explores some of those legal challenges.

Source: Fredreish.com, July 2025

Workers Without Access to Retirement Benefits Struggle to Build Wealth

Retirement savings plans are essential for wealth-building in the U.S., with most of the $20.8 trillion in retirement savings coming from employer-sponsored programs like 401ks. However, nearly 56 million private sector workers lack access to these benefits, hindering their ability to plan for retirement. Expanding access and participation in workplace retirement savings could help families secure their financial futures and reduce future social service costs for state and local governments.

Source: Pew.org, June 2025

Study Finds Record High Investment Anxiety

A recent study by Allianz Life Insurance Company reveals that American investors are increasingly anxious about market conditions and their retirement savings. In the 2025 Q2 Quarterly Market Perceptions Study, 48% of respondents expressed that they are too nervous to invest, an increase from 41% in Q1 and the highest level recorded since 2019. Additionally, 47% are concerned that market volatility is jeopardizing their long-term financial security. Nearly 73% of participants fear that ongoing volatility could negatively affect their financial plans, and 72% worry about affording their desired retirement lifestyle if these conditions persist.

Source: Allianzlife.com, June 2025

Are Managed 401k Accounts Worth the Extra Cost?

Managed 401k accounts are becoming more common in company plans, with nearly all Vanguard participants having access to target-date funds and about 80% to managed accounts led by financial advisers. However, these managed accounts come with annual fees ranging from 0.4% to 0.6% of the account balance, in addition to the fund's underlying expenses. Whether to opt for a managed account versus a target-date fund depends on individual factors such as personal investment skills, temperament, and financial requirements.

Source: Kiplinger.com, June 2025

Has Pension Participation in the Private Sector Improved?

This brief explores the participation of private sector workers in employer-sponsored retirement plans, addressing whether this participation has improved over time. It first examines the strengths and limitations of annual data from the U.S. Bureau of Labor Statistics, focusing on both employer-based and household-based surveys. The second section discusses pension activity based on additional household surveys, including the Survey of Income and Program Participation, the Survey of Consumer Finances, and the Panel Study of Income Dynamics. Lastly, it summarizes recent efforts to enhance the Current Population Survey to provide more accurate figures on retirement plan coverage and participation.

Source: Bc.edu, June 2025

Four Generations Are Persevering Against Headwinds and Uncertainties to Prepare for Retirement

According to a new survey report by the Transamerica Center for Retirement Studies, 80% of U.S. workers believe their generation will face greater challenges in achieving financial security compared to their parents. Additionally, 68% of workers across various generations feel they might not save enough for retirement even if they work until that time. Despite these concerns, many workers may be missing opportunities that could enhance their financial outcomes.

Source: Prnewswire.com, June 2025

How Economic Uncertainty Impacts Retirement Plan Participation and Savings

Economic uncertainty, such as the current conditions across the country, significantly impacts both business and employee participation in retirement savings plans. A study published in the Journal of Pension Economics and Finance indicated that a young participant's behavior during the Great Recession of 2008 could potentially decrease their retirement account value by up to 8% by age 62. Plan sponsors who recognize these challenges can proactively mitigate their effects on employee participation. Strategies such as improved plan design, enhanced features, and diligent monitoring can help reduce negative impacts on participants. The article explores the various ways that economic downturns influence participant behavior.

Source: Planpilot.com, June 2025

Retirement Savings Rates Reach Record High While Average Account Balances Are Lower: Fidelity

Fidelity Investments' recent analysis for Q1 2025 reveals that average balances in 401k, 403b, and IRA accounts dipped slightly during the quarter, largely due to market fluctuations. On a positive note, both employer and employee savings rates remained robust, with the total savings rate for 403b plans holding steady at 11.8% and the total savings rate for 401k plans rising to a new high of 14.3%.

Source: Fidelity.com, June 2025

Cryptocurrency in 401k: A Balanced Approach Returns

The 2025 Compliance Assistance Release maintains ERISA's fiduciary standards but shifts the DOL to a more neutral enforcement stance regarding cryptocurrency in 401k plans, easing previous tensions. While 401k fiduciaries can now include cryptocurrencies without fearing intensified DOL scrutiny, they must still exercise the necessary care and diligence as mandated by ERISA. They should remain cautious about potential participant claims and class actions.

Source: Benefitslawadvisor.com, June 2025

4 in 10 Employees Cutting Back on 401k Contributions Amid Economic Uncertainty

According to Morgan Stanley at Work's fifth annual State of the Workplace Report, while more employees are participating in retirement plans, they are also reducing their 401k contributions due to economic uncertainty. The report, based on a survey of 1,000 U.S. employees and 600 HR leaders, highlights a growing demand for financial guidance in the workplace as employees seek to navigate their retirement benefits amidst increasing economic challenges. A significant trend identified is that employees are becoming more conservative with their contributions.

Source: 401kspecialistmag.com, June 2025

The Power of Small Data for Retirement Plan Sponsors

As a plan sponsor, you likely dedicate a significant amount of time to managing various data processes, whether it's gathering, analyzing, or reporting information. This focus on data is essential, as data-driven decision-making holds immense value. While macro-level data, such as market trends, economic reports, asset manager white papers, and industry benchmarks, is crucial, are you effectively utilizing the "small data" available within your own organization?

Source: Fiduciaryadvisors.biz, May 2025

Why Don't More 401k Plans Have Lifetime Income Options?

A significant concern among 401k plan participants is the fear of outliving their retirement income, with a recent survey indicating that 93% believe it's important for their plans to offer lifetime income options like annuities. However, many 401k plans still mainly provide lump sum payout options, and installment options are uncommon. Plan sponsors may either be hesitant to include annuities, which can guarantee lifetime income, or lack awareness of their availability. The validity of this fear surrounding annuities raises questions about the lack of options and potential solutions to better incorporate lifetime income guarantees in retirement plans.

Source: Cohenbuckmann.com, May 2025

401k Rollover Delays Could Cost Nearly $76k in Lost Savings

A report by PensionBee highlights the complications and potential costs associated with 401k rollovers when employees switch jobs, estimating that individuals could lose up to $76,000 in lifetime returns. The rollover process is often burdensome, requiring extensive paperwork, phone calls, and delays in receiving checks, which can be exacerbated during market volatility. The analysis modeled the impact of delaying investments for various amounts ($10,000, $50,000, and $100,000) over three different rollover durations, demonstrating how being out of the market can adversely affect potential returns over 30 years.

Source: 401kspecialistmag.com, May 2025

Common Mistakes and Practical Advice When Acquiring a Company With a 401k Plan

Acquiring a company with a 401k plan involves significant risks, especially with recent legal changes and trends. Buyers must understand these developments to avoid harming employees or exposing their 401k plan to prior liabilities. Conducting thorough due diligence on the seller's 401k plan is crucial for making informed decisions and minimizing legal risks.

Source: Foley.com, May 2025

Many Small Biz Owners Not Saving for Retirement: Survey

A recent report from WealthRabbit highlights a significant retirement crisis among small business owners, revealing that one in five have no retirement savings, and most have saved less than $50,000. Many may rely on the sale of their business for retirement funds, but one in three respondents doubt they will ever be able to retire. The 2025 WealthRabbit Small Business Retirement Report indicates that the traditional retirement system is failing this demographic, with women particularly affected, being twice as likely as men to have no savings.

Source: 401kspecialistmag.com, May 2025

2025 PLANADVISER Adviser Value Survey

The 2025 PLANADVISER Adviser Value Survey reveals that 46.3% of plan sponsors using an adviser value "evaluation and monitoring of investment lineup" the most. This finding highlights the key influence advisers have on retirement plan outcomes. The survey analyzes responses from the PLANSPONSOR Defined Contribution Survey, focusing on aspects like investment lineups, plan governance, fiduciary guidance, and plan design.

Source: Planadviser.com, May 2025

Emergency Savings Linked to Less 401k Loan Use, Stronger Retirement Outcomes

A February survey by National Debt Relief reveals that substantial debt is affecting Generation X and Baby Boomers, leading some to postpone retirement. Among 1,000 surveyed individuals, 45% reported carrying an average credit card balance of nearly $9,000, with monthly payments of around $418. Additionally, T. Rowe Price's annual Reference Point report highlights trends in retirement planning, showing a 4% increase in average loan sizes in 2024, slightly outpacing inflation, across all age groups. While loan usage among 401k participants grew by two percentage points from 2023, it remains lower than the peaks seen between 2015 and 2019.

Source: Planadviser.com, May 2025

Extending Retirement by 5 Years Skyrockets Chance of Depleting Retirement Savings

New research from Nationwide and The American College of Financial Services highlights a significant risk associated with extending retirement by just five years: it increases the likelihood of depleting savings by 41%, especially among healthy, higher-income retirees. This concern is further emphasized by Allianz Life's 2025 Annual Retirement Study, which found that 64% of Americans are more afraid of running out of money than dying. The study reveals a disconnect between rising lifespans, which now often exceed 90 years, and inadequate financial planning, leading many to face an increasing risk of outliving their savings.

Source: 401kspecialistmag.com, May 2025

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