Retirement Plan News

Continuing our discussion of Democratic retirement policy initiatives, in this article we briefly review the auto-IRA/plan proposal of Congressman Neal (D-MA), Ranking Member of the House Ways and Means Committee. Under the proposal, private employers that do not currently maintain a retirement plan would be required to adopt a retirement plan or IRA program, with an automatic contribution feature.

The Social Security Administration just announced benefit increases effective in 2027. Current retirees will receive a cost-of-living increase, beginning in January 2027 of 3.6%, reflecting the increase in CPI-W between the 3^rd quarter of 2025 and the 3^rd quarter of 2026.

In anticipation of the coming mid-term elections, we will be considering some key Democratic retirement policy priorities. The two most significant (certainly in terms of budget impact) are proposals to expand the Saver’s Match and to implement a universal auto-IRA/auto-401(k).

The Pension Risk Transfer marketplace is entering the fourth quarter with continuous momentum, supported by the record-high annuity purchase interest rates. Both the duration 7 and duration 15 rates have reached historic highs at the start of the month. Since January 2026, the duration 7 rate has increased 120 basis points, while the duration 15 rate has climbed 112 basis points. These favorable rate movements are creating attractive opportunities and a comfortable environment for plan sponsors to continue to reduce pension risk.

For organizations that want to support employee interest in guaranteed lifetime income, annuities naturally enter the conversation. But an annuity is not necessarily right for every retiree. 

Daniel Aronowitz, the current head of the Department of Labor’s Employee Benefits Security Administration (EBSA), has been a vocal critic of “excessive fee and imprudent investment lawsuits against plan sponsors that followed best fiduciary practices.” In his view, these lawsuits “have become a lucrative way for a small group of plaintiffs’ firms to monetize ERISA’s fiduciary provisions. The key problem is that many fiduciary breach cases are allowed to proceed into expensive discovery even when the plans follow fiduciary best practices.”

On September 8, 2026, the US Federal District Court for the District of Massachusetts issued an order in Piercy et al. v. AT&T Inc. et al., an Athene-related pension risk transfer (PRT) case, dismissing claims against AT&T but allowing plaintiffs to proceed with their claims against State Street Global Advisors (SSGA).

Pension finances improved again during September, driven by higher interest rates, with Treasury yields reaching their highest levels in over 24 years (since June 2002). Both model plans we track¹ gained ground during September: Plan A improved more than 2% last month, and is now up 13% for the year, while the more conservative Plan B gained a fraction of 1% during September and is now up 3% through the first three quarters of 2026: 

Terminating a defined benefit pension plan is a significant project. Before moving forward, plan sponsors need to know what steps will be required and what resources will be needed to complete the process. 

Terminating a defined benefit pension plan will eliminate long-term financial and administrative risk. But settling all of the plan’ liability isn't as simple as making the decision to terminate your plan.  

On September 14, 2026, the US Federal District Court for the Southern District of New York, in IAC Dayton, LLC, and International Automotive Components Group North America, Inc. v. National Retirement Fund, sided with IAC Dayton, the withdrawing employer, holding that the actuary for the National Retirement Fund (NRF) “violated ERISA by using an interest rate that [he] acknowledged was not entirely based on the [Fund’s] expected return on assets.”

The focus on growth. A lot of companies have to be seeing significant declines in sales or revenue before they start considering doing anything different. At October Three, it’s always encouraged to think outside the box or around the corner. Everyone here is 100% focused on making us bigger and better, which is exciting.

On September 1, 2026, the United States District Court for the District of Colorado, in Dolly Dow et al. v. Lumen Technologies, Inc., et al., dismissed plaintiffs’ claim that fiduciaries of the Lumen defined benefit plan violated ERISA in transferring plan liabilities to Athene for lack of Article III standing. In this article, we provide a brief note on the case.

A frozen plan continues to carry risks and costs until its obligations are settled and the plan is terminated. While there may be legitimate reasons to delay termination, sponsors should view waiting as a strategic decision rather than a default response.  

On August 25, 2026, the Government Accountability Office (GAO), on its WatchBlog, posted a piece highlighting findings from its February 26, 2026, report “Department of Labor Guidance Could Mitigate Privacy Risks for Participants,” targeting plan provider use and sharing of participant data.

Freezing your plan is often the first step to address pension risk, but it is certainly not the last. From changing the plan's investments or transferring obligations to an insurer, to terminating the plan altogether, there are many ways to mitigate and/or eliminate risk. And they often work together.  

Freezing a plan can be an important step toward reducing future pension risk. By stopping or limiting future benefit accruals, a freeze can make a plan more predictable and easier to manage. 

On August 7, 2026, IRS released a “Notice of Intent to Issue Regulations with Respect to Saver’s Match Contributions,” providing preliminary guidance with respect the new Saver’s Match contribution rules that, under SECURE 2.0, are effective for taxable years beginning after December 31, 2026.

On August 12, 2026, the IRS issued Notice 2026-49, providing guidance “intended to simplify, standardize, facilitate, and expedite the completion of direct rollovers to or from a retirement plan.” The Notice generally outlines a 5-step plan-to-plan direct rollover process and provides a set of forms for it. Use of the new process is not (currently) mandatory, and the guidance does not provide a safe harbor, but IRS is considering, after receiving feedback, developing regulations that would be (in some respects) mandatory and would provide a safe harbor.