2025 has already been a roller coaster for plan sponsors—regulatory change, cybersecurity threats, shifting fiduciary standards. But—brace yourselves—2026 is going to test all the work you thought you had under control.
Here’s how I see it, and what your checklist should look like if you want to survive (or better yet, thrive).
Why 2026 Will Be a Pressure Cooker
Let’s 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.
· Alternative assets in 401(k)s Private markets are starting to creep into 401(k) menus. That sounds exciting—diversified returns, innovative options—until you factor in the administrative mess. Valuation challenges, liquidity issues, communication demands, and oversight obligations make this a fiduciary minefield.
· SECURE 2.0’s 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’s a fundamental change. And tax rules, notices, and disclosures will be even tighter.
· 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’ll need your process, your benchmarking, and your records airtight.
· Cyber risk meets ERISA AI-powered phishing and cyberattacks aren’t the future—they’re now. And regulators are watching. A breach that impacts plan assets or personal data can become a fiduciary liability. You’ll be judged not just on whether you had security, but whether it was adequate, tested, and maintained.
· Regulatory and oversight intensity Expect enforcement activity to ramp up. Reporting and disclosures will be revisited, interpretations challenged, and compliance gaps exposed.
Your 2026 Preparedness Checklist (Ary Rosenbaum Style)
Because “winging it” is no longer an option. Here’s how to brace for the turbulence:
1. Inventory what must change List all SECURE 2.0 provisions coming online next year—catch-up defaults, Roth conversions, employer match rules. Mark deadlines. Assign responsibility.
2. Review your investment menu If you’re considering alternative or private funds, get due diligence documents, valuation
methodologies, liquidity terms, and suitability analysis. Don’t treat these as accessories—they’re central.
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.
4. Sharpen cybersecurity and tech oversight Security can’t be a checkbox. You need continuous, demonstrable vigilance—third-party audits, penetration testing, staff training, and vendor oversight. And make sure you have cyber and fiduciary liability insurance in place.
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.
6. Strengthen participant communication Changes to investments, Roth defaults, or fees need to be clearly explained. Don’t let notices drown in legalese. Participants will remember confusion more than compliance.
7. Run scenario audits Ask “what if” questions: What if valuations are late? What if a vendor fails? What if there’s a data breach? If you can’t show mitigation steps, you’re vulnerable.
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.
9. Engage your entire team This isn’t just HR’s problem. Involve finance, IT, and legal. Cross-functional communication and accountability matter more than ever.
10. Document every change Keep a log of every update—policies, vendors, disclosures, or processes. Future auditors or plaintiffs will want that paper trail.
Final Thought: Don’t Be Surprised by Tomorrow’s Fire
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.
2026 will test your resilience, your foresight, and your willingness to invest in guardrails—not just for compliance, but for trust. The sponsors that survive and thrive won’t be those who cut corners; they’ll be the ones who leaned in early, documented everything, and treated fiduciary responsibility as a mission, not a burden.
It’s 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’re not caught flat-footed.
Because if there’s one guarantee about 2026, it’s this: change is coming—and it will punish those who weren’t ready.
