Healthcare Provider Update: Healthcare Provider for Lincoln National: Lincoln National Corporation does not directly provide healthcare services. Instead, it operates as a financial services company that offers various insurance and investment solutions. For healthcare coverage, Lincoln National collaborates with health insurance providers like Aetna for its employee benefits and health-related products. Potential Healthcare Cost Increases in 2026: Healthcare costs are projected to rise significantly in 2026, driven by factors such as inflation in medical care and large anticipated increases from major insurers. Premiums for Affordable Care Act (ACA) marketplace plans could soar by over 20% on average, with some states facing hikes that exceed 60%. The potential expiration of enhanced premium subsidies will further exacerbate the situation, leading to a staggering increase of over 75% in out-of-pocket costs for many enrollees. As a result, consumers will need to navigate these challenges carefully, focusing on proactive strategies to manage their healthcare expenses effectively. Click here to learn more
'Thoughtful diversification for Lincoln National employees means strategically selecting a balanced mix of assets to help manage risk and support long-term objectives, rather than simply chasing breadth,' – Brent Wolf, a representative of The Retirement Group, a division of Wealth Enhancement.
'Effective diversification for Lincoln National employees hinges on deliberate asset selection and ongoing oversight to balance risk without sacrificing clarity,' – Paul Bergeron, a representative of The Retirement Group, a division of Wealth Enhancement.
In this article we will discuss
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The advantages and potential drawbacks of diversification for Lincoln National employees.
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Key asset classes and strategies for maintaining balanced portfolio stability.
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Practical steps to identify and eliminate over-diversification and hidden risks.
Overview
Diversification is frequently praised as the foundation of prudent portfolio management—a notion underpinning modern portfolio theory for decades. However, excessive or misdirected diversification can dilute returns, obscure strategic intent, and incur needless expenses, even though distributing investments across several asset classes can help mitigate volatility. Wealth Enhancement financial advisors Tyson Mavar and Patrick Ray highlight that balance and purpose are essential for meaningful diversification. Ray notes that while diversification can help lower volatility and correlation, overdoing it may actually weaken returns and cloud your portfolio’s strategy.
Diversification’s Justification
Fundamentally, diversification aims to mitigate portfolio risk by combining assets with different return profiles. Historically, a balanced allocation—roughly equal parts high-quality fixed income and stocks—has yielded annualized returns near 8% , with volatility around 10% . In contrast, an all-equity portfolio has delivered roughly 15% annualized returns over the same timeframe, at a similar level of volatility. This illustrates how bonds can cushion stock declines without significantly hindering long-term growth. “You’re never going to love every holding in your portfolio at the same time,” Ray explains, noting that uncorrelated assets often smooth performance—even if some holdings lag, others will likely thrive.
Cash and Treasury Bonds: Two Foundations of Stability
U.S. Treasury bonds are among the most reliable diversifiers against equity downturns, helping to softenthe blow of market sell-offs. “Treasuries have historically done a great job mitigating downturns,” Mavar notes. Once viewed as a drag on returns, cash has regained popularity amid higher short-term interest rates. Cash yields now offer both steadiness and optionality, often rivaling or surpassing lower-quality fixed income.
The Drawbacks of Excessive Diversification
Even the adage “more is better” can backfire when applied to portfolios. Juggling too many positions creates management headaches and dilutes conviction. “Many asset types promise diversification but fail to deliver,” warns Ray. Lower-quality bonds often behave like equities under stress, offering little downside mitigation, while certain real estate investment trusts (REITs) now move in lockstep with broader markets. Cryptocurrencies likewise introduce speculative volatility, swapping one form of risk for another rather than serving as a genuine hedge.
Hidden Expenses and Faux Diversifiers
Retail portfolios are rife with “faux diversifiers”—crowded alternative investments, niche hedge funds, or exotic strategies that boast diversification but deliver little. These holdings often carry higher fees, complex structures, and opaque risk profiles. “Once you move beyond simple, low-cost asset classes like stocks and Treasuries, you usually pay more without earning better risk-adjusted returns,” Ray cautions.
Duplication: The Silent Portfolio Eroder
Unintentional overlap can be the stealthiest form of over-diversification. Investors may hold multiple mutual funds or exchange traded funds (ETFs) tracking the same sectors or benchmarks, all while believing they’re diversified. Mavar observes that many clients unknowingly double up on identical exposures, complicating performance analysis and obscuring true risk. Holding individual blue-chip stocks alongside ETFs containing the same names adds little incremental diversification.
Tax Considerations and Strategic Cleanup
When over-diversification or duplication sneaks in, a methodical portfolio “cleanse” can help restore clarity and efficiency. Rebalancing within tax-deferred vehicles such as 401k plans or IRAs is typically straightforward, but selling positions in taxable accounts may trigger capital gains taxes. Mavar suggests phasing trades or waiting for market pullbacks to mitigate tax impact and optimize after-tax returns.
An Equitable Method for Diversification
True diversification isn’t a free-for-all or cure-all; it’s a deliberate tool to manage risk, stabilize returns, and preserve flexibility. As Ray puts it, “Good diversification is about strategy, not quantity.” Choose just enough variety to manage risk without losing sight of your portfolio’s objectives.
Mark Twain’s Basket
“Watch that basket—put all your eggs in one basket—and make sure you watch that basket.”
Make sure your basket is sturdy, aligned with your long-term goals, and free from needless complexity. Thoughtful asset selection, disciplined construction, and ongoing oversight can help Lincoln National employees navigate market cycles and follow a clear path toward their retirement objectives.
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Sources:
1. Investopedia. “ Nearing Retirement? Here’s How to Get Your Investment Mix Just Right ,” by Rachel Hanley, 1 Apr. 2025.
2. Morningstar. “ Our Best Investment Portfolio Examples for Savers and Retirees ,” by Margaret Giles, Christine Benz, 14May 2025.
4. CFA Institute. “ Diversification During Hard Times .” Financial Analysts Journal , vol. 79, no. 2, 2 Feb. 2023, pp. 1–2.
5. Kiplinger. “ 10 Best Target-Date Fund Families ,” by Coryanne Hicks, July 2025.
6. Damodaran, Aswath. Historical Returns on Stocks, Bonds and Bills: 1928–Current . NYU Stern School of Business, https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/histretSP.html. Accessed 4 Aug. 2025.
What is the primary purpose of Lincoln National's 401(k) Savings Plan?
The primary purpose of Lincoln National's 401(k) Savings Plan is to help employees save for retirement by providing tax-advantaged investment options.
How can employees at Lincoln National enroll in the 401(k) Savings Plan?
Employees at Lincoln National can enroll in the 401(k) Savings Plan through the company’s online benefits portal or by contacting the HR department for assistance.
Does Lincoln National match employee contributions to the 401(k) Savings Plan?
Yes, Lincoln National offers a matching contribution to the 401(k) Savings Plan, which helps employees maximize their retirement savings.
What types of investments are available in Lincoln National's 401(k) Savings Plan?
Lincoln National's 401(k) Savings Plan offers a variety of investment options, including mutual funds, target-date funds, and company stock.
What is the minimum contribution percentage for Lincoln National's 401(k) Savings Plan?
The minimum contribution percentage for Lincoln National's 401(k) Savings Plan is typically set at 1% of an employee's salary, but employees are encouraged to contribute more if possible.
Can employees at Lincoln National take loans against their 401(k) Savings Plan balance?
Yes, Lincoln National allows employees to take loans against their 401(k) Savings Plan balance under certain conditions.
What happens to my 401(k) Savings Plan if I leave Lincoln National?
If you leave Lincoln National, you can choose to roll over your 401(k) Savings Plan balance into an IRA or another qualified retirement plan, or you may withdraw the funds, subject to taxes and penalties.
How often can employees change their contribution amounts to Lincoln National's 401(k) Savings Plan?
Employees at Lincoln National can change their contribution amounts to the 401(k) Savings Plan at any time, subject to certain administrative deadlines.
Are there any fees associated with Lincoln National's 401(k) Savings Plan?
Yes, Lincoln National's 401(k) Savings Plan may have administrative fees and investment-related fees, which are disclosed in the plan documents.
What educational resources does Lincoln National provide to help employees understand the 401(k) Savings Plan?
Lincoln National offers educational resources such as workshops, online tools, and one-on-one consultations to help employees understand and manage their 401(k) Savings Plan.