Retirement Lost: Enhancing the Durability of the 401(k) Account

American workers have left billions of dollars in 401(k) accounts that they may never be able to find. The problem affects low-wage workers the most, aggravating income-based retirement inequality. Workers who are laid off or change jobs often leave their 401(k) savings in a former employer’s plan. As time passes, communication breaks down between departed employees and their plans, and changes to the employer, plan provider, or individual accounts may prevent the worker from finding the account. Once participants and plans have lost contact with each other, many plans force transfer balances under $5000 into Individual Retirement Accounts, without the knowledge of the absent account owners. Whether a retirement product can endure for the years necessary to provide retirement support—what this article calls the product’s “durability”—depends upon (1) whether the product retains its value and (2) whether the owner will, as a practical matter, retain access to that value over time. This Article argues that there is an urgent need to enhance the practical durability of 401(k) accounts, and advocates for the consolidation of plan and individual account information into an accessible Retirement Savings Lost & Found database. A database that utilizes and leverages information already existing across government agencies will empower workers and retirees to locate their lost accounts, building a stronger and more equitable retirement system for the future