Nevin's Data "Points"

  For years now, I’ve been saying that the only thing wrong with the 401(k) system is that there aren’t enough of them. And to be fair, the past several years have largely validated that view. Indeed, Vanguard’s latest How America Saves report paints what is, on the surface anyway, a remarkably encouraging picture. Participation rates among eligible workers are near record highs. Contribution rates rose — 45% of participants increased their savings rate in 2025, contributing to an average savings rate of 12.1%, an all-time high. Professionally managed investments dominate participant portfolios. Most investors ignored market volatility entirely — and, doubtless as a result of all that — account balances reached new highs. Yes, after decades spent worrying about employees failing to enroll, hunkering down in stable value funds, or panic-trading during downturns, the modern defined contribution system increasingly appears to be functioning as designed — or, as Vanguard labels it — a...

   If you read only the headlines from the latest Employee Benefit Research Institute Retirement Confidence Survey, the takeaway feels familiar: confidence is slipping, worries are rising, and concern about retirement readiness is once again in focus. Seriously? Look, once you move past the year-over-year decline [i] and look at the levels themselves, the picture changes shape. Yes, confidence is down from recent highs. But retirees, in particular, remain broadly confident in their ability to live comfortably in retirement despite all the “noise” about inflation, Social Security, and volatile markets. Roughly three-quarters still say they feel secure about their financial footing in retirement. That is not a fragile number. It is a resilient one. ad space What stands out even more is how consistently the survey shows a gap between expectations and actual experience. Workers — still on the near side of retirement — are meaningfully less confident than those already in it. That...

   For years, the retirement industry has been obsessed with one key problem: people aren’t saving enough. Now, “suddenly,” we have another. Retirees aren’t spending “enough.” There’s a certain irony in that. After decades of urging discipline, restraint, and delayed gratification, we’re now concerned that retirees are  too  disciplined — that they’re depriving themselves of the very retirement they spent a lifetime preparing for. Some of that is clearly a byproduct of the defined contribution system itself. We’ve spent years focusing workers on how much they can accumulate, not how much they can spend. Defined benefit plans answered a very different question: What will I get? Defined contribution plans leave retirees staring at a balance and wondering how long it will last.  And once the paycheck stops, that question gets very real, very fast. Because while you can model returns, you can’t model life. Inflation, healthcare costs, longevity—those aren’t just var...

   Managed accounts have been praised, criticized, and litigated — often on the theory that they’re little more than expensive target-date funds. However, a recent report actually quantifies their impact — and turns out, it’s not an investment story, it’s behavioral. That report — inauspiciously titled “ The 2026 Managed Accounts Research Series: Analyzing the Value of Managed Accounts ” — was published in mid-January by Morningstar. Of course, Morningstar has a fair amount of “skin” in the managed account space — a reason, if you will, to find a favorable outcome for the design.  And, sure enough, the analysis claims that managed accounts outperform target-date funds and the efforts of so-called “do-it-yourself” investors for — well, everyone. More specifically, the report claims that MAs increase the median wealth/salary ratio at age 65 by 5.9% for TDF investors and by 11.4% for DIY investors. Across all plan participants, adopting an MA led to an overall increase of 7....

  You might have missed it (I nearly did), but January has been declared “National Financial Wellness Month.” The designation (apparently, it’s been so designated since 2011 or thereabouts) is meant to create a time where we’re all encouraged to pay closer attention to our financial well-being. Which, considering that we’ve just emerged from a season of what for many is one of “overspending,” January seems either a good time — or perhaps two months too late. Seriously, while the numbers are modest, surveys (conducted primarily by those promoting or supported by promoters of those services) routinely show that some workers want [i]  —  and even expect —  financial wellness type support from their employers. Not surprisingly, there are employers willing to accommodate this assumption, though —  depending on employer size, location, and source —  fewer than half do, with larger employers notably more likely to do so. And that’s with a truly fluid definition of...