The Lincoln Financial Group announced this week that it is enhancing its retirement plan options by launching a comprehensive pooled employer plan (PEP) solution for 401(k) and 403(b) plans.
Named FlexPEP(k) and FlexPEP(b), the new “side-by-side” pooled employer solutions for businesses and not-for-profit organizations are being launched in collaboration with Smart Retirement Solutions and Envestnet. Smart Retirement Solutions will serve as the pooled plan provider, while Envestnet will serve as the 3(38)-investment provider, managing the investment fund menu for both solutions.
The firm notes that, with these side-by-side solutions, it aims to address the shared needs and interests of smaller businesses and not-for-profit organizations for their retirement benefits, while also expanding awareness of the value of PEPs.
“We’re seeing an uptick in the adoption of group plan solutions as employers look to streamline their retirement plan administration, minimize costs and enhance fiduciary protection,” explained Matt Condos, senior vice president, Retirement Plan Services Product Solutions at Lincoln Financial. “While the SECURE Act and SECURE 2.0 were catalysts for PEP offerings, an opportunity remains for businesses and not-for-profits that are interested in getting more positive outcomes from their retirement benefits.”
Condos further remarked that, in addition to providing these 401(k) and 403(b) solutions, the firm is committed to educating plan sponsors of all sizes about the value of PEPs.
Citing data from Cerulli, the firm notes that as employer size decreases, they are less likely to offer a retirement plan, with those offering a plan trending down from 90% for employers with 500 or more employees to 52% for employers with 1-49 employees.
By adopting FlexPEP(k) and FlexPEP(b), small-to-medium businesses and not-for-profits can offload the time and cost challenges they cite as primary obstacles to offering competitive retirement benefits that support attraction and retention of top talent, the announcement further emphasizes.
Both solutions offer a full-service model, providing access to in-plan guaranteed income solutions and group plan discounts that could help lower overall plan costs. Moreover, with multiple qualified default investment alternative (QDIA) options available, plan sponsors can tailor investment options to meet the diverse needs of their employees.
“We’re excited to expand our relationship with Lincoln in providing PEPs as solutions in the 401(k) and 403(b) marketplace,” stated Tina Anstett, head of Fiduciary Services at Smart Retirement Solutions. “Our mission is to simplify retirement plan sponsorship for employers, and PEPs offer a streamlined, cost-effective solution that aligns perfectly with that goal.”
Sean Murray, head of Envestnet Workplace, added, “As the 3(38) investment provider for these two new solutions, we leverage our core competencies of fiduciary guidance and investment due diligence to help plan sponsors with their investment selection and monitoring. With Envestnet’s industry comprehensive and industry leading Wealth Management Platform, we aim to empower employers to support their employees in achieving their retirement goals.”
Lincoln notes that this latest offering builds upon its suite of retirement solutions, including its “OpenPEP” first announced in 2021.
