News

‘Forgotten’ 401(k) account fees can cost workers thousands in lost retirement savings, report finds

Contributing CNBC writer and editor Jessica Dickler's 06/07/25 piece in CNBC Money takes on the problem of 'forgotten' 401(k) accounts, defined as occurring when employees change jobs, leaving behind 401(k) balances with previous employers. After examining the topic from various perspectives, Dickler closes her piece by citing the Portability Services Network, formed in 2022 by "a group of large 401(k) plan administrators." Dickler reports that the "consortium works with defined contribution plan rollover specialist Retirement Clearinghouse on auto portability, or the automatic transfer of small-balance 401(k)s." She goes on to cite Fidelity's Mike Shamrell, vice president of thought leadership at the nation's largest provider of 401(k) plans, who maintains that the goal of auto portability "is to consolidate and maintain those retirement savings accounts, rather than cashing them out or risk losing track of them, during employment transitions."

Learning lessons from the US long-term savings industry

Writing in Professional Pensions, Tom Ground, the UK-based CEO of Retirement Solutions at Standard Life, describes his "learning lessons" from a recent tour of the US retirement industry. Ground characterizes the US retirement industry as being "at least ten years ahead of [the UK}" and goes on to identify the key areas where the US has excelled. High on Ground's list is auto portability, where he writes: "the US has grasped the nettle and introduced ‘auto-portability' which enables small pots to move with you to your new employer in much the same way the pot follows member concept would have worked here. Feedback from those I spoke to suggested it was an effective...solution to the problem."

$1.7 trillion sits in lost and forgotten 401(k) accounts. Is one of them yours?

Daniel de Vise, writing in USA Today, examines the phenomenon of "missing money" in the nation's retirement system. The author examines multiple approaches for finding forgotten retirement savings account, including dedicated websites, the newly-established Retirement Savings Lost & Found, and personal sleuthing. Perhaps saving the best for last, de Vise turns to auto portability, writing: "[f]ewer 401(k)s will go missing in future, experts say, thanks to the evolving concept of "auto-portability" in retirement plans" embraced by the Portability Services Network (PSN). de Vise wraps up his piece by quoting AARP's David John, who states that PSN will make sure that retirement funds “move seamlessly from one job to another."

Beyond Missing: Targeting Unresponsive Participants in Retirement Plans

Writing in 401k Specialist, Tom Hawkins examines the phenomenon of ‘unresponsive’ participants, which he defines as participants “for whom a plan has correct contact information, but who fail to respond to plan communications.” This sub-set of missing participants presents plan sponsors with unique challenges, because “the challenge is not finding them – it’s engaging them.” Hawkins continues by identifying six major drivers of unresponsive participants, while offering plan sponsors six best practices to minimize them.

Plan Sponsors, Providers Face Challenges Creating Retirement Income

Writing in PLANSPONSOR, Elizabeth Harris turns to retirement industry experts to examine the obstacles associated with turning retirement savings into regular income. Vanguard's Fiona Grieg, global head of the firm's investor research and policy group, addressed empirical data associated with 70,000 retirees, suggesting that many of them "just don’t know what to do." Highlighting the issue of cashout leakage, Grieg noted that "Vanguard is one of the founding recordkeepers of the Portability Services Network and is encouraging its clients to join" while pointing out that the consolidation of "small pots" could deliver significant benefits, considering that the average workers has "nine jobs over the course of their careers."

Adaptability: The Next Step in 401(k) Plan Personalization

Writing in NAPA Net, American Retirement Association Chief Content Officer John Sullivan examines the results of Invesco's Spring 2025 Defined Contribution Retirement Pulse Survey. Sullivan reports that, among several key survey findings, portability is a key preference, with 83% of respondents indicating that they want their contribution rates and auto-escalation features to move with them if they change jobs. These findings echo earlier research views from Vanguard, who speculated that auto portability could be adapted to transfer not only small-balance retirement savings, but savings contribution rate data as well.

Upcoming Changes to 401(k) Plans That’ll Help Almost Everyone Save More

Writing in MSN Money, Sarah Sharkey highlights five key changes to 401(k) plans that promise greater retirement security for America workers. Enabled and/or extended by recent SECURE 2.0 legislation, Sharkey's changes include three "autos" -- auto enrollment, auto escalation and auto portability. Regarding auto portability, Sharkey notes that the new plan feature should exert a powerful effect on preserving retirement savings, writing: "eventually, [auto portability] should help millions of savers keep their nest eggs intact."

Also featured in FinanceBuzz

Saver's Match holds promise for closing savings gap

There’s a lot of attention now focused on the Saver’s Match, the SECURE Act 2.0-enabled program that – starting in the 2027 tax year – will allow qualified individuals who contribute to an IRA or participate in an employer-sponsored retirement plan to receive a 50% federal matching contribution of up to $1,000. In his latest article in Employee Benefits News, RCH President & CEO Spencer Williams breaks down the highly positive impact that the program will have on retirement security, citing research revealing that “the Saver’s Match has the potential to accomplish more than many expected as far as closing the retirement savings gap among Americans.”