Which optional provisions of SECURE 2.0 are taking hold?

Starting in 2025, plan sponsors gained a powerful new tool to support late‑career savers: the option to raise the catch‑up limit for participants ages 60 to 63. Instead of the standard $7,500 cap, eligible participants could contribute up to $11,250, giving their savings a boost as they approach retirement.

Adoption has been strong, with 91% of plans opting in to the higher limit by year-end 2025. And participants took advantage. Among those ages 60 to 63 in plans that offered the enhanced feature, 21% hit the 402(g) elective deferral maximum of $24,500, and more than 90% of those maximizers also made catch‑up contributions (Figure 1). Two‑thirds of catch‑up contributors exceeded the standard limit, and 9% reached the full catch‑up amount, bringing their total annual contributions to $35,750 when combined with the 402(g) maximum.

Notably, about one‑quarter of catch‑up savers directed some portion of these contributions to Roth, signaling growing interest in tax diversification and long‑term flexibility.

Automatic portability—or autoportability—was introduced to make it easier for workers to hold on to their retirement savings when they change jobs. Instead of leaving behind small balances—or seeing them moved into higher‑fee IRAs—participants can have those dollars automatically transferred to their new employer plan. SECURE 2.0 also raised the minimum balance threshold from $5,000 to $7,000, allowing more participants to benefit.

This matters because small retirement account balances are more likely to be lost, cashed out, or eroded by fees. Without autoportability, savings often become fragmented, weakening long‑term growth.

By year‑end 2025, 7% of plans had adopted autoportability, giving separated employees a clearer way to protect, and stay connected to, their retirement assets. It’s a modest step with significant long-term potential.

SECURE 2.0 streamlines hardship withdrawals by allowing participants to self‑certify that they meet IRS requirements, eliminating paperwork and speeding access when time matters. This process is sometimes referred to as an e-certified hardship withdrawal.

Adoption of self-certification remains limited, with only 3% of plans offering the provision as of year-end 2025. Most plans (87%) use Vanguard's summary offer approach to hardship withdrawals, which removes the need to submit supporting documentation up front while still requiring participants to keep records. Ten percent of plans continue to require documentation at the time of withdrawal. Employers may prefer Vanguard’s summary offer to administer withdrawals because it balances ease with accountability.

Emergency expense withdrawals allow participants to access up to $1,000 per year, penalty-free, for unexpected financial needs. Participants may repay the amount over three years, helping them stay on track for retirement once the immediate need has passed.

Despite the potential benefits, adoption remains modest. In 2025, only 4% of plans offered emergency expense withdrawals, and just 0.4% of participants initiated one.

Qualified disaster recovery distributions (QDRDs) bring needed structure and predictability to what has long been a stressful process for both participants and plan sponsors. Previously, disaster‑related relief depended on ad hoc actions from Congress or the IRS, creating uncertainty and administrative complexity.

QDRDs change that. Participants affected by a federally declared disaster can withdraw up to $22,000 per disaster without the 10% early‑withdrawal penalty and repay the amount over three years, allowing them to rebuild savings as they recover.

Adoption of QDRDs is still emerging. By year‑end 2025, 16% of plans had implemented the provision, and 0.2% of participants had used it.

SECURE 2.0 introduced a new withdrawal option for participants experiencing domestic abuse, allowing them to withdraw the lesser of $10,000 (indexed) or 50% of their vested balance without incurring the 10% early‑withdrawal penalty. Participants also have the option to repay the amount within three years, helping them regain stability without sacrificing long‑term financial security.

Adoption of the domestic abuse withdrawal provision is in the early stages. In 2025, 6% of plans offered the provision, and 0.1% of participants had used it. 

Overall, adoption patterns so far suggest that plan sponsors are prioritizing optional provisions that support long‑term retirement savings and taking a more selective approach to features focused on short‑term liquidity. Additional options introduced by SECURE 2.0, including employer contributions treated as Roth and pension-linked emergency savings accounts (PLESAs), have generated minimal to no interest from plan sponsors.

As implementation continues, these early choices provide insight into how plan design is evolving under SECURE 2.0 and which provisions sponsors see as most relevant to participant needs and plan objectives.

The author would like to thank Allyssa Utecht for her support in the data analysis.