Vanguard findings turn attention to withdrawal choices after retirement

In October 2026, Vanguard published How America Retires, linking flexible withdrawal options with a greater likelihood that recent retirees keep savings in workplace plans. Its 29 October release also found that around 15% withdrew their full account as cash in their retirement year. The observations should not be read as proof that retention or a particular withdrawal feature improves retirement income.

For employee benefits teams, the practical question is whether members can understand and use the choices available when employment ends. A plan review should begin with those decisions rather than a target for assets retained by the provider.

Describe the choices and responsibilities

A clear explanation could distinguish taking payments, remaining invested and moving savings elsewhere. It should use the actual plan terms and identify where an individual needs more information or advice. The sponsor should also understand which choices can be revisited later.

If personalised support is offered, its provider and scope should be apparent. General education can explain a decision without implying that the same answer suits everyone. Cost comparisons should likewise be based on the services and charges actually available, with their limits visible.

Test whether the service helps members

Before adding flexibility, a sponsor could define the member problem it intends to address. It might test whether payment instructions are understood and whether unresolved questions reach the right person. These measures would provide a different perspective from the amount of money remaining in the plan.

The explanation should also identify the continuing support route after employment ends, when workplace systems or familiar internal contacts may no longer be available.

Multinational sponsors can use the review method while respecting local retirement arrangements. The US findings provide context, not a universal product recommendation. The useful next step is a documented assessment connecting a proposed feature to members’ needs, actual terms and an accessible route to support.

Sources

Vanguard | How America Retires release | Vanguard links flexible withdrawals with retirees staying in workplace plans