Bank of America launches new app for retirement withdrawals

• Key Insight: Many Americans find it difficult to turn their retirement savings into a steady income. Bank of America's new app, 401(k) Pay, is designed to make it easier.
• Supporting Data: Among 401(k) users who made yearly withdrawals, a Vanguard study found, only 20% took out a consistent, moderate amount.
• Expert Quote: "Turning retirement savings into a reliable income stream is one of the biggest challenges Americans face in retirement," said Jeff Clark, head of defined contribution research at Vanguard.

It's common knowledge that many Americans struggle to save enough money for retirement. But another challenge is how to turn those savings into an income.

On Monday, Bank of America rolled out a new product to help customers solve that problem: 401(k) Pay. The digital "hub," accessible through BofA's website and mobile app, provides a single place for retirees to make decisions and calculations about how to make their savings last through their golden years.

"It introduces a whole suite of tools at a very critical point in that journey for an individual, which is planning for and modeling how the income will get generated from the assets they saved in their 401(k)," John Quinn, BofA's managing director of workplace benefits product, said in an interview.

The nation's second-largest bank acts as a 401(k) recordkeeper for 25,000 companies across the country. For those businesses and their employees, the bank said, 401(k) Pay will be available at no additional charge.

On the new hub, customers can check their 401(k) balances, choose where to deposit withdrawals — including at banks other than BofA — and account for expenses like taxes and cost-of-living adjustments.

As the user makes all these choices, the app calculates how much income will be generated each week, month or year. At that point, the customer can set the timing and size of their disbursements, with the option to recalibrate later — or simply set it and forget it.

"Once they've gone through that process, they can simply say, 'Yep, that looks good,'" Quinn said. "We will then draw down that income for them and send it to them."

Many Americans struggle to devise a steady, sustainable retirement income. In a study of seniors with Vanguard retirement plans, 23% simply cashed out their entire accounts when they retired. Of those who took yearly withdrawals, Vanguard found, the amounts were all over the map — only 20% took out a consistent, moderate disbursement.

"Turning retirement savings into a reliable income stream is one of the biggest challenges Americans face in retirement," Jeff Clark, head of defined contribution research at Vanguard, told American Banker in an email. "Retirees must decide when to withdraw, how much, and from which accounts, all while managing tax efficiencies, market volatility, and the risk of outliving their savings."

Bank of America is not the only 401(k) recordkeeper to offer a mobile app. Fidelity, ADP, Voya and others all provide apps where users can manage their retirement plans.

What sets BofA's hub apart, Quinn said, is the advice it gives customers — recommendations, guidance and "nudges" to make the most of the options available to them.

"What this really does is it helps individuals avoid some fairly common mistakes," Quinn said, "whether that be underestimating longevity risk, failing to account for inflation … mismanaging the withdrawal rates, poor tax planning — there's a lot of pitfalls for individuals as they transfer from their work years into retirement."

A key motive for creating the app, Quinn said, was what the bank was hearing from both employers that sponsor 401(k)s and the employees who use them. According to a 2025 BofA study of about 1,000 U.S. workers, 33% wanted help learning how to generate income in retirement.

Meanwhile, in BofA's conversations with commercial clients, many of them voiced the same concern.

"One of the things that we're continually hearing is, 'Our employees are getting closer to retirement,'" Quinn said. "'It seems as though some of the questions they asked are becoming more prevalent — like, how much will I have? How long will it last?'"

Without referring specifically to BofA's product, Vanguard's Clark said retirement apps can be helpful to Americans struggling with those questions.

"Digital tools and advice can help bridge [the] gap by providing a centralized hub for planning, integrating savings projections, withdrawal strategies, and tax considerations," Clark said. "Digital platforms can offer personalized guidance and scenario modeling, helping participants to retire confidently."