Vanguard Finds Flexible Withdrawals Keep Retirees in Plans

Vanguard's second annual How America Retires report examines how retirees invest, preserve and withdraw their workplace retirement savings.

Updated on Nov. 6, 2026 in Retirement Planning

Vanguard Finds Flexible Withdrawals Keep Retirees in Plans

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Do you feel confident managing your retirement savings after you stop working?

Vanguard released its 2026 How America Retires report on retiree withdrawal behavior. Among recent retirees, access to partial withdrawals and installment payments was associated with a more than 40% greater likelihood of remaining in employer-sponsored plans.

Why it matters

Roughly half of retirees initially keep their savings in workplace plans after leaving work, so how they can draw down those balances shapes long-term retirement income. The findings suggest withdrawal design may influence whether retirees keep assets invested or cash out.

Vanguard's analysis links partial withdrawals and installment payments to a more than 40% greater likelihood of retirees remaining in employer plans, while only 15% withdrew their full balance in their retirement year. The report does not separate whether flexibility drives retention or the two simply occur together.

The players

Vanguard

Vanguard is a major investment management firm headquartered in Valley Forge, Pennsylvania, known for index funds and retirement plan services.

The details

The report examines how retirees invest, preserve and withdraw retirement savings using Vanguard retirement plan data. Retirees receiving regular installment payments generally withdrew smaller portions of their balances than those making occasional withdrawals.

Year of retirement: only 15% of retirees withdrew their entire workplace account balance.
2026: Vanguard released the How America Retires report.

Market Dynamics

This second annual How America Retires report from Vanguard follows its first edition and extends that series to how retirees draw down savings. The findings add to a growing body of retirement-plan data on whether workers keep assets in employer plans after leaving their jobs.

Retirees weighing how to draw down workplace savings may find that partial withdrawals and installment payments affect whether their money stays invested in the plan. Those managing their own portfolios should note that roughly 40% hold highly aggressive or highly conservative allocations, which can shape withdrawal outcomes.

The takeaway

Withdrawal design appears to matter as much as the savings balance itself when retirees decide how to use their workplace accounts. Reviewing whether a plan offers partial withdrawals or installment payments can help clarify options before leaving a job.