2025 has already been a roller coaster for plan sponsors\u2014regulatory change, cybersecurity threats, shifting fiduciary standards. But\u2014brace yourselves\u20142026 is going to test all the work you thought you had under control.<\/p>\n
Here\u2019s how I see it, and what your checklist should look like if you want to survive (or better yet, thrive).<\/p>\n
Why 2026 Will Be a Pressure Cooker<\/p>\n
Let\u2019s call it what it is: a confluence of evolving risk factors, new rules dragging behind them, and expectations from participants that are growing by the day.<\/p>\n
\u00b7 Alternative assets in 401(k)s Private markets are starting to creep into 401(k) menus. That sounds exciting\u2014diversified returns, innovative options\u2014until you factor in the administrative mess. Valuation challenges, liquidity issues, communication demands, and oversight obligations make this a fiduciary minefield.<\/p>\n
\u00b7 SECURE 2.0\u2019s creeping obligations The law continues to phase in. In 2026, catch-up contributions for certain high earners must default to Roth (after-tax) treatment. That\u2019s a fundamental change. And tax rules, notices, and disclosures will be even tighter.<\/p>\n
\u00b7 Fiduciary litigation and forfeiture scrutiny Lawsuits targeting how plan sponsors use forfeitures or handle fees are on the rise. Courts and plaintiffs are asking hard questions: Are you applying forfeitures properly? Are your fees justified and documented? You\u2019ll need your process, your benchmarking, and your records airtight.<\/p>\n
\u00b7 Cyber risk meets ERISA AI-powered phishing and cyberattacks aren\u2019t the future\u2014they\u2019re now. And regulators are watching. A breach that impacts plan assets or personal data can become a fiduciary liability. You\u2019ll be judged not just on whether you had security, but whether it was adequate, tested, and maintained.<\/p>\n
\u00b7 Regulatory and oversight intensity Expect enforcement activity to ramp up. Reporting and disclosures will be revisited, interpretations challenged, and compliance gaps exposed.<\/p>\n
Your 2026 Preparedness Checklist (Ary Rosenbaum Style)<\/p>\n
Because \u201cwinging it\u201d is no longer an option. Here\u2019s how to brace for the turbulence:<\/p>\n
1. Inventory what must change List all SECURE 2.0 provisions coming online next year\u2014catch-up defaults, Roth conversions, employer match rules. Mark deadlines. Assign responsibility.<\/p>\n
2. Review your investment menu If you\u2019re considering alternative or private funds, get due diligence documents, valuation<\/p>\n
methodologies, liquidity terms, and suitability analysis. Don\u2019t treat these as accessories\u2014they\u2019re central.<\/p>\n
3. Benchmark and document your fees Establish your fee benchmarking process now. Engage independent reviews. Record why you selected each provider. Document comparisons and decisions. Lawyers and plaintiffs love missing memos.<\/p>\n
4. Sharpen cybersecurity and tech oversight Security can\u2019t be a checkbox. You need continuous, demonstrable vigilance\u2014third-party audits, penetration testing, staff training, and vendor oversight. And make sure you have cyber and fiduciary liability insurance in place.<\/p>\n
5. Update fiduciary processes and governance Are your committee minutes current? Are consultant recommendations documented? Are fiduciary decisions memorialized? If not, fix it now. Compliance is as much about process as it is about numbers.<\/p>\n
6. Strengthen participant communication Changes to investments, Roth defaults, or fees need to be clearly explained. Don\u2019t let notices drown in legalese. Participants will remember confusion more than compliance.<\/p>\n
7. Run scenario audits Ask \u201cwhat if\u201d questions: What if valuations are late? What if a vendor fails? What if there\u2019s a data breach? If you can\u2019t show mitigation steps, you\u2019re vulnerable.<\/p>\n
8. Lock down insurance coverage The ERISA bond is required, but fiduciary and cyber liability coverage are essential. Review policy limits and exclusions before 2026 hits.<\/p>\n
9. Engage your entire team This isn\u2019t just HR\u2019s problem. Involve finance, IT, and legal. Cross-functional communication and accountability matter more than ever.<\/p>\n
10. Document every change Keep a log of every update\u2014policies, vendors, disclosures, or processes. Future auditors or plaintiffs will want that paper trail.<\/p>\n
Final Thought: Don\u2019t Be Surprised by Tomorrow\u2019s Fire<\/p>\n
In Full Circle, I talked about how life teaches you the lessons nobody hands you. This is one of those lessons for plan sponsors: no matter how good things look today, the environment never stays still.<\/p>\n
2026 will test your resilience, your foresight, and your willingness to invest in guardrails\u2014not just for compliance, but for trust. The sponsors that survive and thrive won\u2019t be those who cut corners; they\u2019ll be the ones who leaned in early, documented everything, and treated fiduciary responsibility as a mission, not a burden.<\/p>\n
It\u2019s not enough to react. You have to anticipate. So take your checklist, tighten your processes, build your defenses, and make sure that when the heat comes, you\u2019re not caught flat-footed.<\/p>\n
Because if there\u2019s one guarantee about 2026, it\u2019s this: change is coming\u2014and it will punish those who weren\u2019t ready.<\/p>\n
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