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New Report Reveals How Retirement Plan Design Can Address the Racial and Gender Retirement Savings Gap

Morningstar Retirement, Defined Contribution Institutional Investment Association, and Aspen Institute Financial Security Program release first report to address race and gender disparities in 401(k) plans

The Collaborative for Equitable Retirement Savings today published its first report, “Racial and Gender Disparities in 401(k) Account Balances: How Large are They and What is Causing Them?” It examined anonymized 2022 data from nine 401(k) plan sponsors across approximately 180,000 active plan participants and found that, even after controlling for salary and tenure, significant race and gender disparities remain in account balances. The report attributes those differences to variations in contribution, loan, and preretirement withdrawal behavior.

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The Collaborative—including Morningstar Retirement, Defined Contribution Institutional Investment Association (DCIIA), and the Aspen Institute Financial Security Program—was formed in 2023 as a multi-stakeholder initiative to understand the complex decisions of savers and make retirement savings more inclusive and efficient.

Additional findings from the first report include:

  • Black and Hispanic females contribute lower percentages of their salaries than their counterparts after controlling for age, salary, tenure, and plan design variables.
  • Black and Hispanic workers withdraw a larger portion of their account balances before retirement and take these preretirement withdrawals more frequently than their white counterparts. These differences grow more extreme the closer people get to retirement.
  • Black participants have a higher probability of having an outstanding loan than their white counterparts. At ages 55-59, both Black men and Black women have a 49% probability of having a loan outstanding.
  • The report’s simulation results indicate that eliminating preretirement withdrawals would substantially mitigate race and gender disparities, particularly for early- and mid-career 401(k) participants.

“It’s well known that there are racial and gender disparities in retirement account balances, but these disparities are not fully explained by different economic circumstances such as income or tenure,” said Jack VanDerhei, director of retirement studies for the Morningstar Center for Retirement & Policy Studies and the report’s lead author. “This paper is the start of a multi-phased effort to model the effects of these disparities and test the effectiveness of different steps employers and policymakers could take. Our initial findings suggest that reducing preretirement withdrawals can significantly narrow racial and gender disparities in 401(k) outcomes.”

“Through CFERS, we are working to ensure that retirement plan participants can reach their retirement and broader financial goals. Examining the retirement savings data, and the underlying behaviors, around the existing disparities has unveiled preliminary insights that will help the retirement savings system evolve to address the racial and gender wealth gap,” said Lew Minsky, president and chief executive officer of DCIIA.

“Retirement savings are the second largest source of household wealth in the U.S., which means that our efforts to close larger racial and gender wealth gaps require a retirement savings system that works for everyone,” said Karen Biddle Andres, director of impact strategy and partnerships at the Aspen Institute Financial Security Program. “This report signals that minor plan and benefit changes can likely translate to significant increases in the retirement savings balances of Black and Hispanic households in particular. Continuing this level of cross-sector collaboration, testing, and innovation will help our retirement savings system realize its promise in Americans’ financial lives.”

The Collaborative’s first publication is focused on its first two of five phases of analysis. The five phases are: identifying existing racial and gender disparities in account balances after controlling for salary and tenure; identifying the causes of such disparities by analyzing race/gender differences in participation, contribution, asset allocation, and loan and preretirement withdrawal behavior; incorporating a stochastic accumulation model to show how these disparities will evolve by retirement age; focusing on how plan design, benefit, and policy changes are likely to influence disparities; and incorporating the stochastic decumulation module from the Morningstar Model of U.S. Retirement Outcomes to allow for the analysis of various risk management techniques. A summary of the first report can be found here.

About The Collaborative for Equitable Retirement Savings

The Collaborative for Equitable Retirement Savings is a multi-stakeholder initiative in the U.S. that aims to make retirement savings more inclusive by addressing and mitigating race and gender disparities in 401(k) plans. The coalition analyzes challenges and opportunities for equitable retirement savings through data-driven research and analysis; champions policy changes and best practices for employers and recordkeepers to promote diverse participation and savings in 401(k) plans; provides resources and tools to raise awareness about retirement savings disparities and empower individuals to make informed decisions; and brings together key stakeholders from across the retirement industry to work towards solutions. For more information, visit

About Morningstar Retirement

Morningstar Retirement empowers investor success by providing research- and technology-driven products and services that help individuals reach their retirement goals. With advisory services provided by Morningstar Investment Management LLC, Morningstar Retirement supports and collaborates with workplace retirement plans and other industry players to differentiate their services, stay competitive, and reach new markets, all in service of building a better retirement system. Morningstar Retirement not only helps people save for the retirement they want but helps them make their money last once they get there.

About The Morningstar Center for Retirement & Policy Studies

The Morningstar Center for Retirement & Policy Studies has the mission to help improve the U.S. retirement system by arming decision- and policy-makers with unbiased and actionable data and analysis. The Center draws on the capabilities of Morningstar Retirement to fuel its commitment to helping people achieve better retirement outcomes.

About Morningstar, Inc.

Morningstar, Inc. is a leading provider of independent investment insights in North America, Europe, Australia, and Asia. The Company offers an extensive line of products and services for individual investors, financial advisors, asset managers and owners, retirement plan providers and sponsors, and institutional investors in the debt and private capital markets. Morningstar provides data and research insights on a wide range of investment offerings, including managed investment products, publicly listed companies, private capital markets, debt securities, and real-time global market data. Morningstar also offers investment management services through its investment advisory subsidiaries, with approximately $286 billion in assets under advisement and management as of Dec. 31, 2023. The Company operates through wholly- or majority-owned subsidiaries in 32 countries. For more information, visit Follow Morningstar on X @MorningstarInc.

About Defined Contribution Institutional Investment Association (DCIIA)

Founded in 2010, DCIIA is a non-profit association dedicated to enhancing the retirement security of America’s workers. DCIIA’s 300+ member organizations include investment managers, consultants and advisors, law firms, recordkeepers, insurance companies, data providers, plan sponsors (through the Plan Sponsor Institute) and others who are collectively committed to the best interests of plan participants. DCIIA also conducts proprietary research and participates in industry collaboration on retirement topics via the DCIIA Retirement Research Center. DCIIA is the association partner of the Journal of Retirement. For more information, visit:

About the Aspen Institute Financial Security Program

The Aspen Institute Financial Security Program’s (Aspen FSP) mission is to illuminate and solve the most critical financial challenges facing American households and to make financial security for all a top national priority. We aim for nothing less than a more inclusive economy with reduced wealth inequality and shared prosperity. We believe that transformational change requires innovation, trust, leadership, and entrepreneurial thinking. Aspen FSP galvanizes a diverse set of leaders across the public, private, and nonprofit sectors to solve the most critical financial challenges. We do this through deep, deliberate private and public dialogues and by elevating evidence-based research and solutions that will strengthen the financial health and security of financially vulnerable Americans. To learn more, visit, join our mailing list at, and follow @AspenFSP on X and LinkedIn as The Aspen Institute Financial Security Program.

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