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Middle-market firms show growing interest in pooled 401(k) plans
CBIZ last month launched the CBIZ Retirement Advantage PEP, a shift that aims to consolidate fragmented employer plan setups into one professionally managed structure.
Middle-market employers have long had a heavier share of 401(k) complexity, including greater administrative work and fiduciary risk they cannot easily spread across dedicated internal teams, according to Insurance Business America.
CBIZ Retirement and Investments executive Mike Ziccardi said a Pooled Employer Plan, or PEP, allows multiple employers to share one professionally managed 401(k) plan, reducing administrative burden and transferring fiduciary responsibility. He added that CBIZ is bringing a new option to market with the CBIZ Retirement Advantage PEP, launched last month.
PEPs have been available since 2021, enabled by the SECURE Act of 2019, but adoption among middle-market employers has been measured. Ziccardi described a pattern in which innovations tend to start in the large-market segment first, while many middle-market employers wait to see how early adopters perform.
Ziccardi said the “market thaw” is underway as PEPs build a longer track record and employers become more comfortable, with interest rising gradually rather than suddenly. He also pointed to Department of Labor bulletin data indicating that PEP adoption has continued to accelerate since the SECURE Act’s passage, with hundreds of plans registered nationwide.