Is Your 401(k) Too Expensive & Complicated?

A Pooled Employer Plan (PEP) is a type of 401(k) retirement plan created by the SECURE Act 2.0 implemented in 2021 that allows multiple unrelated employers to participate in a single plan. This pooled structure enables businesses to offer competitive retirement benefits while reducing costs, simplifying administration, and lowering fiduciary liability through shared economies of scale. 

Unlike a traditional 401(k) where each employer sponsors their own plan, a PEP is sponsored by a Pooled Plan Provider (PPP) who assumes most fiduciary responsibilities. This means less administrative burden, lower costs through economies of scale, no annual audit requirements, and significantly reduced personal liability for business owners. 

In a PEP, the Pooled Plan Provider (PPP) assumes most fiduciary responsibilities including investment selection, plan administration, and compliance. This dramatically reduces your personal liability compared to a traditional 401(k). 

PEP costs vary by provider and plan size, but all plans are priced based on the average participant account balance. Many businesses save 20-40% compared to traditional 401(k) plans due to economies of scale, elimination of audit fees, and reduced administrative costs and burden. Get your complimentary benchmark to see exact savings for your company. 

Most businesses with W-2 employees are eligible to join a PEP, regardless of industry or size. PEPs are particularly beneficial for companies with 10 or more employees. There are no commonality requirements—unrelated businesses from different industries can participate in the same PEP.