Fidelity Investments has dipped its toes in the market for pooled employer plans with an offering for small businesses who are not currently retiring

The Fidelity Advantage 401 (k) pooled employer plan that started Jan 21 is only available to small businesses with five to 50 employees who are new to offering a retirement plan, said Andy Schreiner, senior vice president of contributory innovation at Fidelity

The pooled plan complements the options of the Fidelity Small Business Owner Retirement Plan, including SEP and SIMPLE IRAs, Mr. Said carpenter

While the PEP is currently only available to first-time plan providers, it will continue to evolve to include employers who already sponsor plans, Mr. Schreiner said the PEP is currently only available through Fidelity, but the company plans to expand its distribution network

In addition to acting as a provider of pooled plans, Fidelity also acts as the secretary, trustee, 3 (16) plan administrator, and 3 (38) investment manager

PEP has received an “extremely positive first response” so far as their first 10 clients are preparing to join, Mr Said Schreiner The first-time adopters represent a wide variety of industries and are located in different regions of the country

Each of the adopting employers pays a one-time starting fee of $ 500 and an annual fee of $ 1$ 200 for records covering plan administration, employee communication and training, and tax returns associated with the plan.In addition, employees pay an annual subscription fee of $ 100 and an annual fee of $ 0.55% investment services fee based on their account balance. p>

Fidelity joins at least two other minute takers who have either started a PEP or registered with the Department of Labor as a provider of pooled plans.The Principal Financial Group announced on Jan. January launched a pooled employer plan called EASE 1 for small plan sponsors with assets of up to 10 million USD as well as for employers who want to offer their employees a pension plan Pentegra Services has now registered as a pool plan provider Jan 15

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World News – CA – Fidelity Launches Pooled Small Business Employer Plan

Source: https://www.pionline.com/defined-contribution/fidelity-launches-pooled-employer-plan-small-business