Safeguarding Americans’ retirement savings with loan default protection

Preventing retirement loan defaults matters

Custodia Financial is on a mission to close the retirement savings gap and help participants preserve their hard-earned retirement savings through retirement loan default protection. Preventing loan defaults—it matters.


Percentage of 401(k) plan participants holding a loan over a five-year period1


Percentage of participants with an outstanding loan balance who default when they leave their job1


Lost retirement savings over a career for a typical defaulting borrower2

1Source: Wharton Pension Research Council, 2015
2Source: Deloitte Consulting, “Cumulative Leakage Model,” 2018

$2+ Trillion

Employees’ retirement savings that could be preserved through retirement loan default protection

Closing the retirement savings gap for all employees

Preserve retirement savings progress

While on the surface 10% annual average loan default rates may seem like a small number, the compounding effects of lost balances, taxes, penalties, and cash outs add up to significant lost savings for employees and fiduciary risk for plan sponsors.

Improve employees’ financial wellness

Over 90% of participants value the plan’s loan feature as a source of liquidity for financial emergencies that exceed emergency savings. 80% say loan insurance is appealing and likely to reduce financial stress. And more than two-thirds (67%) say they’d consider contributing more to the plan if it offered loan insurance. 

 Source: Greenwald 401(k) Borrowers study, 2019

Enable loan payment portability

Custodia Financial’s Retirement Loan ProtectionSM not only covers unexpected job loss; it also allows participants to continue making loan repayments after they voluntarily change jobs.

Loan default protection—the future of retirement wellness starts now.