Fidelity Investments has reported record-high retirement account balances in the latter half of 2024, with the average 401k balance reaching $132,300 and the average 403b balance at $119,300. Contribution rates are also increasing, getting closer to Fidelity's recommended 15% savings rate (including both employer and employee contributions). According to Fidelity's 2025 workplace outlook report, 69% of employees and 67% of employers view retirement plans as essential benefits. In 401k plans, employers contribute an average of 4.7% of pay, while employees contribute 9.4%, totaling 14.1%. In 403b plans, employer contributions average 3.3%, and employee contributions average 8.5%, resulting in a total of 11.8%.
A federal judge in Amarillo, Texas, has once again dismissed the arguments from 26 Republican-led state attorneys general questioning the validity of the Biden Administration’s ESG rule. This coalition had requested the court to rethink its previous decision upholding the rule following the U.S. Supreme Court's overturning of the Chevron doctrine in June. The Labor Department's rule permits sustainable investment options in 401k plans, using ESG factors as a "tiebreaker" when other investment considerations are equal.
Joshua Cook, an attorney specializing in cybersecurity, emphasized the importance of trust between service providers and their employees or clients during a webinar on February 5. He highlighted that acquiring and managing private information and operating systems involves significant commitments, with maintaining security being crucial. Cook pointed out the pervasive threat of cybercrime, citing that nearly 900,000 complaints were filed with the FBI in 2024. He warned that "the threat is ubiquitous," indicating that everyone is at risk of cyber threats.
401k plans are essential for small businesses as they help attract and retain talent, provide tax advantages, and support employees' financial futures. Offering these plans enhances a company's competitive edge in the job market and promotes employee satisfaction and loyalty. Modern providers have simplified the setup process, making it easier for small businesses to implement 401k plans. This article explores the benefits of providing a 401k, outlines different plan types, and offers a step-by-step guide to establishing a plan. It also addresses costs and financial considerations associated with 401k plans, as well as common challenges that businesses may face and strategies to overcome them.
This whitepaper examines the changing dynamics of retirement plans, focusing on the trend of "retailification," where institutions use their relationships to market retail products and services to plan participants. It discusses the associated risks and conflicts, explores ways to generate extra compensation, provides historical context, and offers future predictions. Additionally, the paper outlines strategies for effectively managing and mitigating these conflicts. Registration required.
U.S. employee benefit plans are increasingly targeted by criminals, with hackers stealing sensitive data and funds from retirement accounts, sometimes resulting in participants losing their life savings. Employers may assume that cybersecurity is the responsibility of financial institutions or service providers, like banks and health insurance companies, which are subject to strict regulations. However, employers also have a critical role to play in ensuring the cybersecurity of their benefit plans.
Traditionally, 'retirement' is defined as the time when individuals stop working. However, recent trends indicate that this definition is becoming less applicable. A report from Indeed Flex reveals that 88% of Baby Boomers are still in the workforce, including those aged 59-65, who traditionally might still be employed. For those aged 66-77, however, the expectation of retirement is shifting, as many find themselves working longer than previous generations. This suggests a change in the concept of retirement in modern society.
The DOL has issued guidance on two topics: Missing Participants and Beneficiaries, along with the Retirement Lost and Found Program outlined in the SECURE 2.0 Act of 2022. The practical impact of these guidelines for plan sponsors is still uncertain. Some of the nine criteria for acceptable Supplementary Determination of Uniformity and Propriety outlined in the guidance may be challenging for plan fiduciaries to verify. As a result, fiduciaries can rely on the State Treasurer's assertions that these requirements are met, unless they have contrary knowledge.
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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.
