“Retirement Security Rule” – Latest Developments
With the Department of Labor (DOL) declining to challenge industry groups’ motions for final judgment, the 2024 version of the fiduciary rule known as the Retirement Security Rule has been vacated.
The 2024 rule would have extended ERISA fiduciary duties to cover certain one-time professional retirement investment recommendations such as rollovers, annuity purchases, and plan menu design.
In March this year, the U.S. District Court for the Eastern District of Texas issued a ruling to vacate the rule. The ruling was unopposed by both the DOL and key industry groups.
The department subsequently published guidance on March 20, formally reinstating the 1975 five-part test as the governing standard for determining ERISA fiduciary status and republished Prohibited Transaction Exemption 2020-02 in its original 2020 form. Under the five-part test, a financial professional is only considered an ERISA fiduciary if they provide investment advice on a regular basis, under a mutual agreement that the advice will serve as a primary basis for investment decisions, and for direct compensation.
This outcome doesn’t necessarily signal an end. The DOL has indicated it intends to issue a new version of the fiduciary rule as early as May 2026. The department has not yet issued substantive details but has indicated the rule’s new version “will ensure that the regulation is based on the best reading of the statute” and will align with an executive order calling on departments to reduce regulatory burden.
Sources:
https://www.asppa-net.org/news/2026/3/gavel-comes-down-on-fiduciary-rule-once-and-for-all/
https://www.thinkadvisor.com/2026/03/17/second-judge-vacates-dol-fiduciary-rule-dealing-death-blow/
https://401kspecialistmag.com/dol-lets-biden-era-fiduciary-rule-die-in-court/
https://www.reginfo.gov/public/do/eAgendaViewRule?pubId=202504&RIN=1210-AC36
AI Used Widely (Though Not Always Wisely) for Retirement Planning
AI is now a copilot for everyday tasks, helping people with emails, meal planning, workout routines, and more. It's also impacting how participants approach retirement planning.
AI’s Growing Influence on Financial Decision Making
While health and wellness rank as a top use case for AI (44%), finance is a close second (41%), according to a recent Credit Karma survey. A separate Empower study found that, year over year, nearly half (47%) of Americans now feel more comfortable using AI for personal finance purposes. They’re turning to AI for retirement planning recommendations (56%), debt consolidation advice (58%), and budgeting help (54%).
Among Credit Karma respondents who use AI for financial advice, 35% use it for financial education and basic personal finance concepts, 35% for goal setting and financial action plans, 34% for budgeting and expense management, 32% for stock market investing, and 31% for retirement savings. A sizeable 85% who have used AI for financial advice report taking action based on AI recommendations. Notably, however, more than half of that group reported those decisions ultimately resulted in what they considered to be poor outcomes.
The Human Factor Remains Important
AI is not the final word for most users when it comes to financial advice, as 8 in 10 Credit Karma respondents report conducting additional research and validating advice before acting on it. When they do turn to tools over people, reasons include accessibility, lack of fees, and the anonymity of a judgment-free environment.
Among Empower respondents, 62% emphasize the value of receiving human input, especially for more important financial decisions such as investing, and 61% say they’d use AI in conjunction with human financial advice to try to obtain better results.
Users Face Privacy Risks
Looking beyond advice and outcomes, experts note the potential privacy risks associated with AI use. They recommend against entering sensitive and personally identifiable data (e.g., account and Social Security numbers) into AI tools. They also advise against sharing specific income and balance information and to use general ranges instead.
How Sponsors and Advisers Can Help
As their employees increasingly turn to AI for retirement planning guidance, sponsors can help by putting these tools in context and educating participants about the risks of misinformation and the importance of protecting their data. They can also refresh their communications to address emerging AI-related questions, promote fiduciary resources available through the plan, and ensure advisors remain accessible for support.
Sources:
https://www.empower.com/the-currency/money/ai-advantage-research
https://www.nytimes.com/2026/02/08/business/retirement-planning-ai-chatbots.html
Survey: Knowledge Gap Drives Retirement Plan Nonparticipation
Among people who choose not to participate in their employer-sponsored retirement plan, many cite a lack of understanding as the primary reason, according to recent surveys.
Regulatory mandates have attempted to harness the power of automatic features and strengthen retirement readiness. SECURE 2.0 requires 401(k) plans established on or after December 29, 2022 to automatically enroll employees at 3-10% of pay, with annual 1% escalations up to 10-15%. (Businesses with 10 or fewer employees or those operating for less than three years are exempt until they cross those thresholds.)
Despite mandates like these and the prevalence of automatic features, some employees do elect to opt out of plan participation. Within plans offering automatic features, around 7% of employees still decline participation, according to a Vanguard study. An Ascensus survey finds 30% of nonparticipants don’t know how a plan works, and 23% view retirement savings as unaffordable.
Advisors can address knowledge gaps by helping employees better understand the value of their plans and clearly articulating how participation can help them meet their goals. Sponsors can help too with clear, accessible, and frequent communications and by offering enrollment assistance across multiple channels.
Automatic features can help boost participation and improve retirement outcomes, but sometimes it’s the human element that can make the difference in getting employees to take the critical first step.
Sources:
https://www.asppa-net.org/news/2026/3/lack-of-awareness-big-driver-of-low-participation/
https://www.thepensionsource.com/irs-releases-guidance-on-automatic-enrollment-under-secure-2-0/
https://www.sparkinstitute.org/wp-content/uploads/2024/10/EligibleNotParticipatingResearch.pdf