Protecting Workers’ Retirement Savings. How 401(k) loan insurance can maximize the power of automatic portability.


As defined contribution retirement plans become the dominant retirement savings vehicle for American workers, policymakers and plan fiduciaries must embrace necessary changes to make these plans work better for more workers. While we’ve made great progress in helping workers save for retirement through auto-enrollment, auto-escalation and qualified default investment alternatives, we still have gaps that have allowed retirement plan loan default leakage to become a more than $2 trillion problem. The two most significant sources of leakage identified by the non-partisan Employee Benefits Research Institute are cash-outs and loan defaults when workers leave their jobs. Fortunately, there is an opportunity for industry and plan leaders to address both issues.

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