Is a PEP Right for You?

11/01/2022 Written by: Jenny Boudreau

Providing employees with a quality retirement savings plan may seem out of reach for smaller or start-up companies. But a key provision of the SECURE Act introduced a new option, called a PEP, designed to make retirement plans more accessible to employers and employees.

Pooled Employer Plans (PEPs) allow unrelated businesses to pool together to benefit from potential cost savings and fewer administrative tasks associated with offering a retirement plan. An updated version of multiple employer plans, PEPs:

  • Remove the requirement that employers share a commonality.
  • Eliminate the rule that all participating employers bear responsibility if one employer violates plan rules and regulations.
  • Use a pooled plan provider to run the plan.
  • Require an ERISA 3(16) administrator.
  • Typically involve a discretionary investment manager under ERISA 3(38).

As an employer, you have an opportunity to offer a retirement savings program to your employees without the administrative headaches traditionally associated with running a retirement plan. With a PEP, you can:

  • Spend less time on retirement plan administration and more time focused on company goals.
  • Provide a high-value, competitive benefits package to help attract and retain top talent.
  • Benefit from expert investment selection and fiduciary protection.

And while you benefit from the convenience of the PEP, you maintain the flexibility to design the features that work best for your organization.

A Retirement Plan That Works for You

The AssuredPartners PEP was created to deliver a cost-effective and practical retirement solution to help plan sponsors navigate an increasingly complex legal and regulatory environment. Designed to help plan sponsors with administrative tasks, members benefit from:

  • Simple plan administration
  • Independent investment and fiduciary consulting
  • Program trust oversight
  • Diverse investing options
  • Employee education and retirement planning guidance

A defined contribution plan may be one of the best savings vehicles for employees; however, those without access to an employer-sponsored retirement plan often struggle to save anything. PEPs can help fill this coverage gap by enabling smaller organizations to access the benefits of scale that larger organizations can with a traditional 401(k) plan. Contact an experienced retirement plan advisor at AssuredPartners Investment Advisors to learn whether a PEP is right for you and your employees.

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