401(k) Real Talk Episode 195: May 27, 2026

Welcome to this week’s edition of 401(k) Real Talk, where Fred Barstein, contributing editor for Wealth Management’s RPA channel, reviews all of last week’s industry news and selects the five most important/interesting stories.

Worth Reading:

Read the full raw transcript below: 

Greetings & a warm welcome to this week’s edition of 401k Real Talk. This is Fred Barstein contributing editor at WealthManagement’s RPA omnichannel and CEO at TRAU, TPSU & 401kTV – I review all of this week’s stories and select the most important and interesting ones providing open honest and candid discussion you will not get anyway else. So let’s get real!  

Related:401(k) Real Talk Episode 194: May 27, 2026

FIRST STORY

Not surprisingly, the DOL under new EBSA director Aronowitz has taken an activist role in ERISA litigation recently making oral arguments on behalf of plan sponsors targeted for alleged misuse of their forfeiture accounts. They had previously filed amicus curae briefs.

It seems like courts are siding with plan sponsors when they follow plan documents with none ruling that the use of forfeiture accounts to offset match payments is per se illegal.

But the issue is whether the DOL should take such an active role in litigation and whether all ERISA lawsuits are bad damaging, not helping participants and their beneficiaries. With few people and resources, will there be fewer DOL investigations?

It should be noted that Aronowitz had previously headed up a fiduciary insurance firm that protected plans against ERISA litigation.

Next story:

The dangers of AI and so called finfluencers were discussed at FINRA’s annual conference with a professional from Morgan Stanley noting that AI like ChatGPT may inadvertently be swayed by these finfluencers learning from social media and blogs.

Though many of these sites caution that they are not providing advice, many investors and AI may not notice.

69% of investors using social media and finfluencers lost money compared to just 29% of others. Investors indicated greater trust in advice provided by a fincial advisor v. AI. According to a FINRA study.

Related:401(k) Real Talk Episode 193: May 20, 2026

The issue is not necessarily malice or misinformation by finfluencers. The issue is bias and, like all things with AI, the source of the information.

So while AI seems to promise to be able to help democratize advice to DC participants without an advisor, it may just actually enable advisors and a new crop of financial coaches to be more productive.

NEXT STORY

While auto features have had a huge impact on DC plans, a blog by T R Price suggests that there is still much work to do and how to better improve outcomes.

Auto enrollment into TDFs have become ubiquitous but less so reenrollment and auto escalation. Concerns about reenrollment seem to be inflated with 79% remaining in the plan even though loan usage is higher in plans that auto enroll.

People with significant emergency savings have higher derail rates and account balances and are less likely to take a hardship withdrawal or loan which suggests that more plans should incorporate PLESAs and that perhaps the limit should be increased.

Next Story

As rollovers from DC plans into IRAs have increased to $1 trillion and are expected top grow to $1.3 bn in 2031 according to the latest  Cerulli study, more firms and advisors are reexamining their rollover process and strategies.

Related:401(k) Real Talk Episode 192: May 13, 2026

Peter de Silva, president of IRALOGIX which helps facilitate rollovers for advisors and provides, makes the case for building relationships early and before a participant separates through education and one on one engagement as well as ongoing communication.

In fact, the amount of rollovers captured by advisors with an existing relationship is 5.5 times higher while the rollover is 47% higher according to Cerulli.

De Silva advocates for improved infrastructure and process using institutional priced investments in IRAs.

FINALLY

There has been a lull in the consolidation of 401(k) record keepers briefly interrupted by the pending Ascensus acquisition of American Trust which may be a false positive. There are still over 40 national and 200 regional record keepers, which is unsustainable, but buyers have dried up. The big pay days enjoyed by MassMutual and Prudential may be over evidenced by the shockingly low price paid by Voya for OneAmerica’s DC business 

Read my recent WealthManagement.com/RPA column about why should advisors care and what they can do to help clients navigate the next wave of record keeper consolidation.

FINISH

So those were the most important stories from the past week. I listed a few others I thought were worth reading covering:

Please let me know if I missed anything or if you would like to comment. Otherwise I look forward to speaking to you next week on 401k Real Talk.