Once a year your plan sends a comparative chart showing how each investment option performed against a benchmark. If your money sits in a target-date fund, that benchmark is probably one stock index — and the comparison is close to meaningless. Congress ordered a fix. The deadline was December 29, 2024.
What the Rule Requires Today
Under 29 CFR 2550.404a-5(d)(1)(iii), a plan must disclose "the name and returns of an appropriate broad-based securities market index" over 1-, 5-, and 10-calendar-year periods for every option whose return isn't fixed. Note the singular: an index.
That was a deliberate choice. When the Labor Department finalized the rule in 2010, commenters asked for composite benchmarks precisely because balanced and lifecycle funds hold both stocks and bonds. DOL refused, concluding participants "would benefit more from having a single recognizable benchmark for each designated investment alternative under the plan, rather than multiple or blended indices for each."
The practical result: a 2050 fund holding roughly 90% equities gets measured against a broad equity index, and a 2030 fund with a large bond allocation gets measured against the same kind of index. One looks roughly fine. The other looks broken — and isn't.
Section 318 and the Missed Deadline
Section 318 of SECURE 2.0, titled "Performance Benchmarks for Asset Allocation Funds," directed the Secretary of Labor to issue regulations "not later than 2 years after the date of enactment" permitting a blend of broad-based indices, subject to four conditions: the blend must be reasonably representative of the fund's asset-class holdings; be updated at least annually if holdings shift; be presented so the average participant can understand it; and use underlying indices that would each qualify on their own.
SECURE 2.0 was enacted December 29, 2022, putting the deadline at December 29, 2024. The rule sits at RIN 1210-AC26, still in the proposed stage, with DOL's own agenda targeting a proposal for October 2026. A review of every EBSA Federal Register document published from September 1 through November 2, 2026 turns up nothing on benchmarks. Almost two years past the statutory deadline, the proposal hasn't been written.
This is not a small audience. Morningstar's 2026 Target-Date Fund Landscape put target-date assets at $4.8 trillion at the end of 2025, up more than 20% in a year.
The Workaround That Already Exists
Here is the part most participants never hear: blended benchmarks are already permitted as supplemental disclosure. Paragraph (d)(2)(ii) says nothing "shall preclude a plan administrator from including additional information that the plan administrator determines appropriate for such comparisons, provided such information is not inaccurate or misleading."
DOL said so explicitly in 2010. A plan "may... blend the returns of more than one appropriate broad-based index and present the blended returns along with the returns of the required benchmark," so long as the blend reflects actual holdings — using a 60:40 fund as its example. Section 318 would promote the blend from optional extra to permissible primary. Sixteen years on, plans can do this without waiting for any rulemaking.
Practical Takeaways
- Check what your fund is actually measured against. Find the comparative chart in your annual fee disclosure and read the benchmark name. If it's a single equity index next to a 2030 fund, the gap you see is mostly asset allocation, not manager failure.
- Build the blend yourself. Pull the current stock/bond split from the fund's fact sheet and weight a total-market equity index and a broad bond index to match. That is the comparison section 318 was meant to give you.
- Ask your plan to add one. It's a permitted supplemental disclosure under (d)(2)(ii) — a request your committee can grant now.
- Mind the vehicle. Morningstar found collective investment trusts held 54% of target-date assets at the end of 2025, up from 52%. CITs don't file fund prospectuses, so the 404a-5 chart carries more weight for those investors.
- Don't fire a fund for trailing the wrong yardstick. Judge the glidepath against your own time horizon and risk tolerance first. Morningstar also reported asset-weighted target-date expenses fell to 27 basis points from 29 — fees are a more reliable signal than a mismatched benchmark.
Sources: SECURE 2.0 Act section 318, Public Law 117-328 (enacted December 29, 2022), via GovInfo; 29 CFR 2550.404a-5(d)(1)(iii) and (d)(2)(ii); DOL final rule, 75 FR 64910 (October 20, 2010); Unified Agenda RIN 1210-AC26 (reginfo.gov); Federal Register API, EBSA documents September 1–November 2, 2026; Morningstar 2026 Target-Date Fund Landscape (March 11, 2026), via 401(k) Specialist.