By Tom Hawkins | August 17, 2026

America’s mobile workforce just can’t seem to get a break from our defined contribution retirement system.

Faced with numerous job changes over the course of a career, a fragmented retirement system that makes cashing out easy and moving retirement savings forward difficult, plan participants must also contend with another, largely overlooked problem: plan churn.

Plan churn occurs when an employer swaps retirement plan recordkeepers or terminates its retirement plan altogether. While these events may seem administrative in nature, they can create significant complications for workers who have already changed jobs and left retirement accounts behind.

They’re Mobile, But the Ground Beneath Them is Also Moving
The average 401(k) participant will hold approximately 9.9 jobs during his or her working career, resulting in an estimated 14.8 million defined contribution participants that change jobs each year. That’s around 17% of all active participants in the defined contribution plan system.

These employment transitions, when combined with a lack of plan-to-plan portability, represent the single greatest trigger for retirement savings leakage.

But how many participants are affected by plan churn?

Data derived from DOL Pension Plan tables, Form 5500 datasets and industry practitioners suggest that each year, approximately 4.2 million participants are affected by a change in recordkeepers, while 1.9 million are impacted by a plan termination, for a total of 6.1 million participants, or around 7.0% of active participants.

So, plan participants – while highly mobile themselves – may also find that the ground has moved under their feet due to plan churn.

Recordkeeper Changes
Employer-sponsored retirement plans routinely change service providers. Industry practitioners estimate that large plans evaluate or change recordkeepers approximately every seven to ten years, and the participant experience during such transitions can be disruptive. Accounts are migrated to new systems, websites change, participant communications are redirected, and historical records may become more difficult for former employees to access.

For active participants, recordkeeper transitions generally receive considerable attention. Former employees, however, may no longer be receiving company communications or may have changed addresses, email accounts, or phone numbers. When a plan changes providers, these former participants can become further disconnected from retirement assets they left behind years earlier.

The risk compounds over a career. A worker who changes employers ten times and leaves balances behind may encounter not only multiple former plans, but also several generations of recordkeeper conversions within those plans. Tracking down accounts can become increasingly difficult as systems, vendors, and contact information change over time.

Plan Terminations
Even more disruptive is the termination of a retirement plan. The IRS notes that employers are not legally required to maintain retirement plans indefinitely and may terminate them for a variety of reasons, including business sales, mergers, bankruptcies, restructurings, or the decision to adopt a different retirement program. Upon termination, participants become fully vested and plan assets must generally be distributed as soon as administratively feasible, typically within one year.

Examining data collected from Form 5500 and Form 5500-SF filings, in 2022 there were 28,430 plans that performed their final filings, with 1.9 million participants at the beginning of the year. Also, the fact that the IRS and the DOL maintain detailed guidance on plan terminations underscores that they are a routine feature of the retirement-plan landscape.

For participants who have already left employment, plan termination can create a new layer of complexity and mistakes can be made by plan sponsors, most of whom are encountering the plan termination process for the first time. For example, distribution notices may be sent to outdated addresses, and participants who fail to respond may have their savings transferred into a safe harbor IRA and struggle years later to determine where their assets ultimately landed. Even when distributions are handled properly, the process can increase fragmentation and reduce participant engagement with retirement savings.

Why Mobile Workers Are Especially Vulnerable
The combination of workforce mobility and plan churn can combine to create a perfect storm, where mobile participants are incentivized to cash out, which is typically the easiest option available to them.

Plan churn magnifies these risks because the underlying retirement plan infrastructure is itself constantly changing.

The Case for Automated Consolidation
Some argue that the Retirement Savings Lost & Found could represent a panacea for left-behind accounts created via job-changing and plan churn. While I consider it to be useful tool, I believe that it’s weak sauce in addressing the root cause: a lack of plan-to-plan portability.

A more coherent and holistic response is to reduce account fragmentation through automated consolidation.

Retirement Clearinghouse’s auto portability solution, delivered via the Portability Services Network, and the broader vision for a digital clearinghouse model is designed to move retirement savings from former-employer plans into active accounts at new employers, creating continuity despite job changes or plan churn.

The value of this approach extends beyond reducing cashout leakage. Consolidated accounts are insulated from future episodes of plan churn. When assets reside in a participant’s current workplace plan, they are less likely to be stranded when a former employer switches recordkeepers, merges plans, terminates a plan, or exits business altogether.

Solving for Plan Churn
In a labor market characterized by frequent job changes and constant institutional change, plan churn is not an exception – it’s a structural reality. As workers continue to move throughout their careers, automated account consolidation may prove essential for keeping retirement savings visible, connected, and working toward the ultimate goal of retirement security.

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