The 401k Podcast with Fexingo: Employer Retirement Plans, Matching, and Long-Term Saving

Episode 29 of The 401k Podcast tackles one of the most misunderstood features of employer retirement plans: the vesting schedule. Lucas and Luna break down how vesting works, why a three-year cliff or five-year graded schedule can leave thousands of dollars on the table if you change jobs too soon. They walk through a real example: a 30-year-old earning $65,000 who contributes 6% to capture a 4% m...

Starting in 2024, the SECURE 2.0 Act allows employers to make matching contributions to your 401k based on your student loan payments, even if you don't contribute to the plan yourself. In this episode, Lucas and Luna break down how the provision works, who qualifies, and why it could be a game-changer for younger workers juggling debt and retirement savings. They walk through a real-world example...

Episode 27 of The 401k Podcast with Fexingo dives into the auto enrollment default rate—the percentage of your salary that gets automatically deducted into your 401k when you first join a company. Lucas and Luna explain why the typical default of 3% is a dangerous trap, how it compounds into a six-figure shortfall by retirement, and what you can do to override it. They use the example of a 25-year...

In this episode of The 401k Podcast, Lucas and Luna dig into the Qualified Default Investment Alternative, or QDIA — the default fund your 401k plan automatically invests you in if you don't make an active election. Most QDIAs are target-date funds, but not all target-date funds are created equal. Lucas explains how different plan sponsors choose different glide paths, and why a 35-year-old employ...

Episode 25 of The 401k Podcast with Fexingo dives into the often-overlooked role of the plan fiduciary — the person or committee legally responsible for managing your 401k in your best interest. Lucas and Luna unpack a real case: the 2024 Supreme Court ruling in Jander v. Retirement Plans Committee of IBM, which clarified that fiduciaries can be sued for offering imprudent investment options even...

Most 401k participants assume their plan's investment menu is built by objective experts. But many plan sponsors—often HR directors or CFOs with no investment training—rely on advice from brokers who collect hidden revenue-sharing payments. In this episode, Lucas and Luna examine a 2019 study from the National Bureau of Economic Research showing that 401k plans advised by brokers who receive reven...

In this episode of the 401k Podcast, Lucas and Luna explore a little-used 401k feature: after-tax contributions. Unlike Roth contributions, after-tax contributions can be rolled into a Roth IRA tax-free through an in-plan Roth conversion, enabling the mega backdoor Roth strategy. Lucas breaks down the difference between designated Roth contributions and after-tax contributions, how to check if you...

Lucas and Luna dig into the fine print of 401k employer matches that take years to fully vest — and the math on how much you actually walk away with if you leave early. Using a concrete example of a 6% match with a six-year graded vesting schedule, they show that a worker earning $75,000 who switches jobs after two years forfeits nearly $4,000 in unvested employer contributions. The episode covers...

In this episode, Lucas and Luna dig into a hidden cost in many 401k plans: recordkeeping fees that are bundled into investment funds rather than charged transparently. They explain how the Department of Labor's fee disclosure rules from 2012 were supposed to help, but a common practice called 'revenue sharing' still obscures what participants actually pay. Using the example of a mid-sized company...

Every 401k participant gets a fee disclosure document each year, but almost nobody reads it. Lucas and Luna crack open an actual fee disclosure from a mid-sized company plan to show listeners what's hiding in plain sight: revenue sharing arrangements, wrap fees on stable value funds, and the difference between administrative fees and investment management fees. They walk through a concrete example...

Lucas and Luna explore the self-directed brokerage account (SDBA) option inside many 401k plans. They break down how a window works, the typical fees and restrictions, and when it might outperform a standard fund menu. A real-world example: a listener in her early 40s who used an SDBA to buy a low-cost S&P 500 ETF instead of her plan's target-date fund, saving roughly 40 basis points annually. The...

Lucas and Luna dive into the Safe Harbor 401k match, a provision that allows highly compensated employees to max out their contributions without failing nondiscrimination tests. They use a concrete example: a dental practice with 12 employees where the owner wants to contribute $23,500 but historically the plan fails the ADP test. They explain how the Safe Harbor match works, the two main formulas...

Episode 17 of The 401k Podcast with Fexingo. Lucas and Luna dig into a hidden trap lurking inside most employer retirement plans: the default contribution rate. Most plans auto-enroll new employees at just 3%, a number that subtly anchors savers into under-saving for decades. Lucas walks through the math — how a 3% default versus a 6% default can mean a difference of over $200,000 in retirement sa...

In this episode of The 401k Podcast with Fexingo, Lucas and Luna zoom in on target-date fund glide paths—the formula that shifts your portfolio from stocks to bonds as you near retirement. They explain why not all glide paths are created equal, using Vanguard's 2030 fund as a concrete example, and discuss how a 'to-retirement' vs 'through-retirement' approach can change outcomes by tens of thousan...

Most 401k participants think they're paying zero investment advice fees. That's usually wrong. Lucas and Luna unpack the managed account service quietly embedded in many employer retirement plans — a feature that auto-enrolls you into a daily portfolio management fee of 0.30 to 0.50 percent on top of fund expense ratios. They walk through a concrete example: a 45-year-old with $150,000 in her 401k...

Most 401k participants name a beneficiary once and never touch it again. Lucas and Luna walk through the specific legal trap: what happens when the named beneficiary is your ex-spouse, a deceased parent, or an outdated trust. They cite real-world probate court cases where the 401k plan administrator had no choice but to pay the person on file, even after divorce or death, because the participant n...

Most 401k plans offer an auto-escalation feature that gradually increases your contribution rate each year, yet fewer than 30 percent of participants actually opt in. In this episode, Lucas and Luna examine how the 'save more tomorrow' psychology works, why inertia kills retirement savings, and how auto-escalation can boost your final nest egg by tens of thousands of dollars without requiring any...

In this episode of The 401k Podcast, Lucas and Luna uncover the hidden costs of borrowing from your 401k. They break down the double taxation trap, the opportunity cost of missing market gains, and the real risk of default if you leave your job. With a concrete example—a $50,000 loan over five years at 8% interest—they calculate the total dollar impact and compare it to alternatives like a persona...

Episode 11 of The 401k Podcast breaks down the hidden revenue streams inside your employer-sponsored retirement plan. Lucas and Luna examine the three main ways 401k providers profit — revenue sharing from mutual funds, sub-transfer agent fees, and float income on cash balances — using actual data from a typical $500 million plan. They walk through how a 1% expense ratio fund might actually cost y...

Lucas and Luna break down the 401k catch-up contribution rules for 2026, covering the new SECURE 2.0 changes, the shift to Roth catch-ups for higher earners, and how to decide if the standard $7,500 catch-up or the new age-60-63 super catch-up of $11,250 is right for your retirement savings. Using the example of a 52-year-old engineer named Priya, they walk through the math and the strategic trade...

Lucas and Luna unpack the specific rules, tax penalties, and long-term cost of taking a hardship withdrawal from your 401k. Using a detailed case study of a 35-year-old engineer who withdraws $20,000 for a medical emergency, they calculate the true cost in lost compound growth — over $100,000 in foregone retirement savings. They also explain the difference between a hardship withdrawal and a 401k...

Episode 8 digs into a little-known 401k feature that could save you thousands in taxes: the in-plan Roth conversion. Lucas and Luna walk through the mechanics, using a concrete example of a mid-career saver with $80,000 in pre-tax 401k assets. They explain how converting to Roth inside your current plan avoids the pro-rata rule that makes traditional Roth IRAs messy for big balances. The episode c...

Lucas and Luna dive into the hidden cost of 401k vesting schedules. Most employees assume their employer match is theirs immediately, but a cliff or graded vesting can leave you walking away from thousands of dollars. Lucas breaks down the difference between cliff vesting (common at startups) and graded vesting (typical at larger firms), using real numbers to show how a three-year graded schedule...

Lucas and Luna dive into the mega backdoor Roth IRA — a powerful yet underutilized retirement strategy for high earners. They break down how it works, who qualifies, and why only 15 percent of companies currently allow after-tax contributions beyond the standard 401k limit. Using concrete examples, they compare tax outcomes for someone earning $200,000, showing how a mega backdoor Roth can save te...

Episode 5 of The 401k Podcast tackles the most popular default investment in employer retirement plans: target-date funds. Lucas and Luna unpack why a 2055 fund may not actually match your risk profile, how glide paths differ wildly across providers, and the specific fee structure that quietly eats returns. They walk through a real-world example from Vanguard versus BlackRock LifePath funds, expla...