Best 401(k) Providers of 2025

Find and compare the best 401(k) providers in 2025

Use the comparison tool below to compare the top 401(k) providers on the market. You can filter results by user reviews, pricing, features, platform, region, support options, integrations, and more.

  • 1
    QuickBooks Payroll Reviews

    QuickBooks Payroll

    Intuit

    $35 per user per month
    916 Ratings
    See Provider
    Learn More
    Streamline payments to your team and leverage robust tools, employee perks, and expert support with the leading online payroll service provider. Handle payroll while having access to HR and employee services all in one convenient location. After your payroll setup is finished, you can automatically pay your team without hassle. Our service will effortlessly calculate, file, and manage your payroll taxes for you. Enjoy the benefit of keeping your cash longer with complimentary same-day direct deposit options. Additionally, you can oversee benefits and employee services directly from your payroll account. With direct deposit, you'll have the added advantage of flexibility in choosing when to pay your team. Your time tracking information is seamlessly integrated into your account, allowing you to approve timesheets, process payments, and generate invoices directly from your mobile device. Save valuable time by automating your payroll processes, and when you enable Auto Payroll, we'll send you timely notifications to help you efficiently manage your account. This way, you can focus more on your business while knowing your payroll is taken care of.
  • 2
    Slavic401k Reviews
    Offering your employees a Slavic-401(k) plan will help you attract and retain top talent. It will also help you create a happier, more stable workforce. Happier employees stay with your company longer, which will allow you to grow your business. You can weigh your options between a standalone 401(k), or participation in a Multiple Employee Plan (MEP). An MEP plan can save you $6,000 to $10,000 annually in audit costs (an IRS requirement for businesses 100+). An MEP does not have an individual audit requirement for your business. It is also possible to outsource the administration and fiduciary responsibility to MEP sponsors, which saves time and money. Employers can face serious problems with 401k compliance and testing. You could face penalties and fines for not properly administering your plan. This can have a devastating effect on a small business.
  • 3
    Guideline Reviews
    Small business owners can have a simple, affordable 401(k). We believe in retirement plans that work. We are on a mission for every small business to offer a 401k. To help participants build a retirement they're excited about. We can sync with top payroll providers, handle plan administration, and offer low-cost mutual fund options. We don't charge additional fees for investments, unlike other 401(k). We are different. We take care of the administration, compliance testing, recordkeeping, and other tasks to make your job easier. Fully packaged. We do all the heavy lifting, from plan administration and employee onboarding to compliance testing, government filing and recordkeeping. These are our features. Predictable pricing. One all-inclusive fee is charged. It starts at $39/mo + $8/mo for each participating employee. There are no additional setup fees or investment fees. Pricing details. Full payroll integration. Fully integrated with top payroll providers, we automatically sync employee data.
  • 4
    TimeTrex Reviews

    TimeTrex

    TimeTrex

    $2.90 per month
    1 Rating
    To automate all calculations, including overtime premiums and multiple pay rates, rules can be applied automatically to employees or situations. Managers can remotely monitor attendance and time of employees and access up to two-thirds of the reports. You don't have to wait until the end for attendance records. To track vacations, sick days and banked time automatically, you can set up unlimited accruals. Employees can view their accrual balances online, which eliminates the need to contact human resources for this information. Management can track and control exactly where employees can punch in/out, down to the device level and GEO fence level. Track employee expenses and allocate time for tasks. In just a few clicks, you can manage employee skills and qualifications and process payroll.
  • 5
    iTrustCapital Reviews
    iTrustCapital was established by prominent figures in the alternative investment IRA sector. As the foremost digital asset IRA trading platform, iTrustCapital enables users to seamlessly buy and trade cryptocurrencies and physical gold in real-time using their retirement funds. This innovative and IRS-compliant platform addresses the expensive inefficiencies and outdated methods associated with traditional IRA systems, allowing investors to securely and conveniently transfer funds into the cryptocurrency and physical gold markets—often at costs up to 90% lower than those of competing IRA providers. The company aims to empower 10 million investors to engage in the economic opportunities presented by a blockchain-driven future. It is surprising to see how many individuals remain unaware of the significant advantages that IRAs can offer. By raising awareness, iTrustCapital hopes to help more people take advantage of these investment opportunities.
  • 6
    401GO Reviews

    401GO

    401GO

    $9 per user per month
    1 Rating
    Managing a 401(k) has reached unprecedented simplicity. With our automated platform, tedious tasks, data-entry mistakes, and overwhelming paperwork are nearly a thing of the past. This shift to automation fosters improved efficiency, which translates directly into cost savings. Your 401(k) will become the most economical and sought-after benefit available! Spend less time managing and increase your savings significantly. 401GO’s user-friendly platform simplifies the path to retirement savings like never before. Instead of just a basic list of investment options, we provide a personalized portfolio design tailored to individual risk tolerance and savings objectives. We have optimized the plan design process by focusing on essential features that businesses truly require. You can launch your plan in mere minutes rather than stretching it out for weeks. Instead of waiting until year-end for filing deadlines, we conduct ongoing automated testing and compliance checks. We also take care of the necessary filings, ensuring that your plan adheres to all regulations. It is crucial to ensure that investments are appropriate for a 401(k) plan, aligning with both compliance and participant needs for a secure retirement. With these advancements, preparing for retirement has never been more straightforward or effective.
  • 7
    Due.com Reviews

    Due.com

    Due.com

    $10 per month
    Know precisely the amount of money that will be deposited into your bank account every month, without any tricks or gimmicks. This approach represents a straightforward solution for retirement tailored to the contemporary individual. Established in 2015, Due initiated its journey with an online invoicing platform aimed at assisting freelancers and small business owners. Since then, Due has enabled countless companies and freelancers to receive payments more swiftly and improve their cash flow while presenting a polished, branded format for payment requests. Within a year of launching, Due expanded its services to include payment solutions for its clientele. In addition, Due provides a diverse array of payment methods, such as eCash, eChecks, ACH, and both domestic and international credit card processing, along with a digital wallet for storing payment details and funds. The straightforward retirement metrics feature illustrates how much you'll accumulate monthly, and you have the freedom to withdraw your entire balance at any time. Signing up for our annuity takes merely five minutes, allowing you to embark on your financial journey with ease. With our user-friendly platform, preparing for a secure financial future has never been simpler.
  • 8
    Human Interest Reviews

    Human Interest

    Human Interest

    $120 per month
    Human Interest makes it simple and affordable for employees to save for retirement. Other 401(k), shady fee-paying providers can profit from you and your employees by charging a lot of hidden fees. You get low-cost plans and funds with us. There are no transaction fees. Your dashboard provides a 360-degree view to your company plan, including employee participation reports and contribution reports. With our seamless onboarding process and integrated investment advice, employees can begin saving in just a few steps. Human Interest takes the hassles out of managing your company's retirement plan. We sync to your payroll and process contributions. We also handle compliance testing and IRS paperwork. We offer traditional and Roth 401(k), 403(b), Safe Harbor plans, profit-sharing plans, and traditional Roth 401(k). We'll help you choose the right plan for you. Employers have the option to customize vesting and matching options at no additional charge.
  • 9
    Betterment Reviews

    Betterment

    Betterment

    $1,644 per 2 employees
    Betterment streamlines the administration of your retirement plans, enabling you to provide your employees with an enhanced 401(k) option swiftly and effortlessly, all while keeping costs significantly lower than most competitors. Acting as your comprehensive partner, we handle everything from initial onboarding to ongoing management, reporting, and investment strategies, all at one of the most competitive rates available. Our tailored guidance is designed to assist your employees in achieving superior returns while managing their risk levels effectively. We support them in creating a customized retirement plan, advising on savings amounts and suitable accounts. This empowerment allows your employees to take charge of their financial future, helping them remain engaged and productive in their roles. When we searched for a contemporary, user-friendly retirement plan for our team, we discovered that existing solutions were often costly and overly complicated. Consequently, we developed our own 401(k) offering by utilizing the strengths of our retail investing platform, ensuring that it meets the needs of both employers and employees. By providing this solution, we aim to simplify retirement planning for everyone involved.
  • 10
    401k Easy Reviews

    401k Easy

    401k Easy

    $495 set up fee
    Low-cost 401k plans offer absolutely NO fees and avoid any "low" fees that could erode employees' retirement investments! For small businesses, there is an extensive range of no-load funds available, along with commission-free trading options for stocks and bonds through self-directed brokerage windows. These IRS-approved 401k prototype plans are tailored to meet the unique requirements of small business owners, including the annual 5500-SF filing and additional features! For more than 35 years, we have provided small business owners with affordable 401k solutions backed by a steadfast guarantee—NO fees are taken from the assets of the 401k plan. In contrast to other providers, Low-Cost and No Fee 401k Easy ensures that no fees or commissions are deducted from employees' retirement savings, allowing them to retain 100% of what they have diligently earned and saved. Utilizing the no-fee 401k Easy service means that financial advisors and their partners will never profit from hidden fees, ensuring that all funds remain in the hands of employees planning for their future. With this approach, small businesses can invest in their employees' financial well-being without the burden of unnecessary costs.
  • 11
    AB401k Reviews

    AB401k

    Americas Best 401k

    $400 Quarterly
    A Contemporary 401(k) Without Intermediaries. If your current service provider appears on our list, we can probably help you cut your fees by 40% or more. Simply share your fee disclosure, known as a 408b2, from your existing provider. Should you have trouble finding it, give us a call, and we'll guide you on where to look. It's important to remember that the Department of Labor frequently mandates that plan sponsors assess their plan against benchmarks, ensuring that your fiduciary responsibilities are met. As you aim for a solid and secure retirement, is your 401(k) aligned with your goals? One of our experts will assist you with a free “side-by-side” fee analysis, allowing you to understand how elevated fees can affect your account's growth over time. Take initiative and transition to America's Best 401k today. There are no fees for conversion, and our dedicated team will ensure the process is seamless for you. The sooner you make the change, the sooner your savings will start to accumulate. Don’t wait; your financial future depends on the choices you make now.
  • 12
    Ocho Solo 401k Reviews
    The Ocho Solo 401k offers unparalleled tax benefits for entrepreneurs compared to any other retirement plan available. You can contribute as much as $61,000 while enjoying tax-free compounding across various asset classes. Designed with user-friendliness in mind, Ocho ensures that managing your solo 401k is a seamless experience, allowing you to create your account, make contributions, and invest directly through a streamlined, easy-to-use dashboard. Setting up a solo 401k with Ocho is incredibly simple and can be completed in under ten minutes, with all necessary paperwork and administration handled on your behalf, eliminating the hassle of opening separate accounts for banking and brokerage. Investors can choose to put their money into traditional financial vehicles like stocks, mutual funds, and ETFs, or they can exercise checkbook control to invest directly in alternative options, such as real estate, cryptocurrency, and private equity, providing a diverse range of opportunities to grow their wealth. With Ocho, the path to a successful retirement plan is not only accessible but also flexible, catering to the unique needs of each business owner.
  • 13
    Ubiquity Retirement + Savings Reviews

    Ubiquity Retirement + Savings

    Ubiquity Retirement + Savings

    A 401(k) is a retirement savings plan set up by employers or self-employed individuals to assist both workers and business owners in accumulating funds for retirement while enjoying various tax incentives. This savings option is designed to meet diverse retirement planning needs, offering flexibility in how contributions are managed. Participants have the autonomy to determine the percentage of their salary that will be directed into their 401(k) accounts each pay period, with those contributions made before taxes are applied, allowing for potential growth without immediate tax implications. Many employers enhance this savings approach by matching a part of the contributions made by employees, which can significantly accelerate the growth of retirement funds. In addition to securing future financial stability, enrolling in a 401(k) offers distinct tax benefits for both employees and employers, such as tax deductions and tax-deferred growth on earnings. For instance, when employees allocate funds to their 401(k), these amounts are deducted from their gross income prior to tax calculations, effectively lowering their taxable income for the year. This dual benefit of saving for retirement while optimizing tax responsibilities makes the 401(k) an appealing option for many individuals and businesses alike.
  • 14
    Transamerica Retirement Solutions Reviews
    Our primary focus is to utilize our knowledge and resources for one essential purpose: assisting individuals in saving and investing wisely so they can enjoy the life they aspire to lead. We achieve this by simplifying the process for organizations to offer valuable benefit programs to their workforce. By enhancing administrative efficiency and alleviating fiduciary concerns, we also encourage employees to fully engage with the benefits available to them. Our commitment lies in supporting participants in reaching a well-funded retirement. Using established strategies and cutting-edge tools, we aim to inspire them to enroll early, increase their savings, and diversify their investments effortlessly. Moreover, as they navigate through retirement, we equip them with resources that enable effective management of their retirement income, ensuring they are well-prepared for the future ahead. Ultimately, our goal is to empower individuals to take control of their financial journeys.
  • 15
    Vestwell Reviews
    Tailored investment solutions and plan structures enable you to create a flexible offering suited to your current needs while accommodating future adjustments as your business evolves. Enjoy a contemporary, intuitive experience that enhances user engagement and satisfaction. Our transparent and competitive pricing ensures both you and your employees are fully aware of all costs involved. We offer comprehensive administrative services that cover operations, support, and compliance with 3(38), 3(21), and/or 3(16) regulations. Whether you choose to collaborate with an advisor or go solo, we help you identify the ideal plan for both you and your workforce. Access the vital information necessary to effectively manage and service your plan via our digital, interactive portal. We make it simple for your employees to start saving; just upload your initial payroll and census data, and we’ll take it from there, ensuring a seamless transition into your new saving strategy. With our support, your employees will be on the path to financial security in no time.
  • 16
    Shelton 401(k) Reviews
    A 401(k) plan tailored for small businesses encompasses various components that are essential for aiding employees in their retirement planning journey. Shelton 401(k) focuses on delivering retirement account solutions specifically designed for small enterprises, ensuring that the experience remains hassle-free for business owners. At Shelton Capital Retirement Plan Services, we collaborate closely with our clients to offer a cost-effective, all-in-one solution that simplifies processes and yields the best outcomes for everyone involved. Our commitment is to deliver exceptional, high-touch 401(k) services that not only assist your employees in building their retirement savings but also enhance your professional image. We pride ourselves on our team of seasoned service experts who provide both live and digital personalized resources tailored to meet the needs of you and your employees. Unlike large fund managers or insurance companies, Shelton 401(k) operates as a small privately owned entity, emphasizing human administration over automated systems. Our focus on personal interaction ensures that clients receive attentive care and support throughout their retirement planning experience, fostering a sense of trust and reliability.
  • 17
    ShareBuilder 401k Reviews
    Our 401(k) plans are structured to reduce the expenses associated with retirement benefits, allowing you to maximize your savings. Whether you’re a small enterprise initiating your inaugural 401(k) plan or a more established company aiming to cut costs and enhance your services, we are dedicated to meeting your needs. Discover the advantages of tax savings and increased annual contribution limits available with a 401(k). Make your investments more economical with our selection of premium investment options. Enjoy the possibility of reducing taxes for both yourself and your business. We provide tailored 401(k) plans, accommodating everyone from self-employed individuals to businesses with up to 100 employees. As you save for retirement, you can simultaneously reduce your tax burdens. Utilize the expertise of ShareBuilder Advisors and the support of Customer Success Managers to guide you. If you’re new to offering a 401(k) plan for your business, a brief online search can quickly direct you to the necessary aspects you should consider when selecting a 401(k) provider, such as services, costs, and investment opportunities that are crucial for your success. Here’s some valuable information to assist you in this journey. Additionally, taking the time to understand the features of our plans can empower you to make informed decisions for your future.
  • 18
    Bitwage Reviews

    Bitwage

    Bitwage

    $7.99 per month
    We provide innovative solutions tailored for remote professionals who seek employment opportunities and efficient wage payment methods. Our offerings include distinct job opportunities, adaptable payment schedules, lower payroll expenses, and expedited fulfillment processes. Workers can receive a fraction of their earnings in digital currencies. Our services enable swift and cost-effective international invoicing with direct deposits to bank accounts and digital wallets. We cater to global individuals who prefer to receive their payments in digital assets for their work. Additionally, we assist companies in providing unique digital asset benefits to their workforce. Organizations aiming to streamline their payment processes for employees and freelancers can also benefit from our services. We focus on delivering cutting-edge HR solutions to meet evolving needs. Bitwage continuously evaluates wage distribution mechanisms across borders, juxtaposing conventional methods like bank transfers with emerging international systems, including XBT and XRapid protocols. This comprehensive strategy allows Bitwage to significantly lower the costs associated with compensating workers, freelancers, and outsourcing firms on a global scale while enhancing the overall payment experience. Ultimately, we aim to revolutionize how payments are processed internationally, making it more efficient and accessible for all parties involved.
  • 19
    ForUsAll Reviews
    Our innovative technology, coupled with extensive experience in ERISA plans, culminates in a 401(k) solution that alleviates both workload and liability for you. This is certainly a significant advantage. We streamline various manual processes such as managing contributions, handling 401(k) loans, tracking eligibility, assessing hardships, and sending notifications, allowing your team to concentrate on core business functions. Dealing with payroll issues can be quite challenging. To mitigate this, we meticulously analyze payroll for every employee using 44 distinct diagnostic checks to identify and rectify potential problems before they escalate. You can monitor the overall wellness of your plan, including its readiness for audits, through a detailed dashboard that encompasses all essential plan documents. To ensure you remain free from compliance risks, we offer comprehensive administrative and investment fiduciary protections, identified as 3(16) and 3(38) fiduciary services. Our dedicated plan administrator is responsible for reviewing, signing, and submitting your Form 5500. Additionally, we maintain a robust $5 million professional liability insurance policy to safeguard our ERISA fiduciary services and give you added peace of mind. With our comprehensive support, you can focus on growing your business while we handle the complexities of your retirement plan.
  • 20
    ASC Defined Contribution / 401(k) System Reviews
    The ASC DC/401(k) administration platform is consistently refreshed to reflect all legislative updates. It features adaptable eligibility calculations, a user-friendly data import wizard, and thorough data validations. It accommodates multiple funds and sources, utilizing both dollar and share accounting methods. Additionally, the ASC system includes a comprehensive Compliance Testing System. Users can generate reports from the standard options provided or utilize the ASC Reporter to design tailored reports. The platform incorporates built-in budget-solving routines for various plan types, such as new comparability, super integrated, age-weighted, and sole proprietor/partnership plans. It also accurately calculates different employer contributions for 401(k) and other defined contribution plans. Furthermore, it conducts extensive employee data validation seamlessly, with the capability to apply custom validation formulas. This makes it an essential tool that remains fully aligned with all legislative changes for effective administration.
  • 21
    ADP Retirement Services Reviews
    Our retirement plan solutions provide a range of advantages, including straightforward plan management, impartial investment options, fiduciary services, and efficient setup processes, all of which contribute to meaningful benefits. ADP is dedicated to preparing participants for retirement by equipping your employees with valuable tools that enable them to strategize for their future at their own pace. With a mobile enrollment platform that allows participants to sign up anytime and from anywhere, combined with features like the MyADP Retirement Snapshot calculator—designed to give users a personalized estimate of their retirement savings through tailored questions—and proactive messaging that delivers essential updates, we continuously prioritize the needs of both you and your workforce. It is imperative to make informed investment decisions for your plan, as this directly influences its overall success, thereby ensuring that all participants can achieve their retirement goals effectively. Additionally, our commitment to innovation means we are always exploring new ways to enhance the retirement planning experience for everyone involved.
  • 22
    Pontera Reviews
    Unify multiple accounts into a comprehensive strategy with Pontera, which enables advisors to oversee and manage 401(k), 403(b), and other held-away accounts, ensuring they effectively address their clients' requirements. By optimizing tax strategies, advisors can enhance client wealth over time. The Pontera platform allows for swift and efficient allocation of investments between taxable and tax-deferred accounts, enabling advisors to better serve their clients. Furthermore, Pontera enhances transparency by helping advisors present a clearer picture of portfolio activity to their clients. In conjunction with existing technologies, Pontera provides greater portfolio visibility, allowing advisors to offer a more cohesive service. By regularly rebalancing and monitoring retirement accounts, akin to custodial accounts, advisors can provide stability and reassurance, particularly during market fluctuations. This proactive approach not only boosts client satisfaction but also contributes to improved long-term financial outcomes. Ultimately, Pontera empowers advisors to maintain control and confidence for their clients in an unpredictable investment landscape.
  • Previous
  • You're on page 1
  • Next

401(k) Providers Overview

A 401(k) provider is a financial services company that administers and manages employer-sponsored retirement plans, including 401(k) plans. The primary role of the 401(k) provider is to facilitate the offering of a retirement savings plan for employees. This includes managing investments, providing education to employees about investing options, and administering payroll deductions.

To offer a 401(k) plan, employers must select and contract with a qualified 401(k) provider. There are two categories of providers: mutual fund companies and full-service providers that offer recordkeeping services in addition to investment options. Employers may also choose to outsource their plan administration duties to third-party administrators (TPAs).

When selecting a provider, employers should consider the following factors: cost of services offered; a range of investment choices; customer service; fiduciary liability coverage; participant education materials; features such as auto-enrollment or target date funds; employer reporting capabilities; vesting schedules; rollover options and fees associated with them; user experience quality if an online platform is used by participants to manage their accounts.

The costs associated with 401(k) plans vary widely depending on the services provided by the providers, but typically include annual administrative fees based on assets managed as well as fees for each transaction (such as contributions or withdrawals). Additionally, there may be expenses associated with specific investments such as mutual funds that are offered within the plan. When selecting a provider, it is important for employers to compare all fees thoroughly in order to determine which option best suits their needs while keeping employee costs low.

401(k) providers must adhere to ERISA regulations which require all service providers involved in the administration of plan activities (including investment advisors or TPAs) to be deemed “fiduciaries” under ERISA law – meaning they are obligated to act solely in the interests of participants and beneficiaries when providing advice or carrying out administrative functions related to the plan. As part of this obligation, these fiduciaries must ensure all provided services meet certain standards regarding impartiality, prudence, and loyalty when making decisions related to the management of the plan's assets or other matters affecting those assets and participants’ rights connected thereto. By meeting these standards and adhering closely to applicable laws governing 401(Ks), a provider can help protect employers from fiduciary liability arising from improper handling of employee savings accounts within retirement plans sponsored by employers who hire them for said purpose.

What Are Some Reasons To Use 401(k) Providers?

  1. Flexibility – 401(k) providers allow you to customize and tailor your retirement plan according to your individual needs and goals with various plan options, investment choices, and contribution limits.
  2. Tax-Deferred Growth – Contributions made into a 401(k) provider can grow tax-deferred until funds are withdrawn. This means that any capital gains or dividend income dividends earned in the account will not be subject to immediate taxation.
  3. Employer Matching Contributions – Many employers will match contributions made into an employee’s 401(k), up to a certain limit, which increases the rate of return on funds invested in the account over time.
  4. Automatic Savings – The funds for contributions are taken directly from payroll before taxes are deducted, allowing for automatic savings without having to worry about actively setting aside money each month for retirement planning goals.
  5. Low Fees – Most 401(k) providers offer competitive rates on fees so investors can keep more money in their accounts, helping them reach their financial goals sooner rather than later.

The Importance of 401(k) Providers

401(k) providers are important for a variety of reasons. First, they provide retirement accounts that encourage people to save for the future. These accounts allow individuals to set aside money pre-tax, and often employers will even match the contributions their employees make into these accounts. This creates incentives to build up retirement savings in a more secure manner than just investing in stocks and bonds on an individual basis.

Additionally, 401(k) providers help protect savers by providing access to low-cost investments as well as financial advice or assistance from professional advisors. They also help maintain compliance with federal regulations and ensure that any funds saved are adequately secured against market volatility or economic downturns. Finally, having a provider keeps costs low for consumers since all fees associated with running the plan can be spread out among other investors in the same account type.

Overall, 401(k) providers serve an important role in helping people plan for their retirement years by offering cost-effective options with fewer risks than traditional investments without involving too much risk. Additionally, many employers rely on these providers when setting up company plans so their employees have access to helpful tools like investment advice and automatic contributions each month through payroll deductions. By having a provider manage these details, everyone is able to benefit from saving for their future while ensuring that all regulatory standards are met.

401(k) Providers Features

  1. Investment Options: 401(k) providers offer a range of investment options, such as stocks, mutual funds, or annuities, to help participants diversify their retirement savings.
  2. Contribution Limits: 401(k) plans come with maximum contribution limits set by the IRS – $19,500 in 2021 for those under the age of 50 and $26,000 for those aged 50 and over.
  3. Automatic Contributions: Many 401(k) plans allow employers and/or employees to make automatic contributions to the plan on predetermined dates or times throughout the year.
  4. Tax Benefits: Contributions made to a 401(k) plan are tax-deferred which means contributions are not taxed until withdrawals are made during retirement. Additionally, some employers will match employee contributions up to a certain amount which creates further savings opportunities through additional tax incentives.
  5. Portability: Typically 401(k) plans can be rolled over from one employer’s plan to another employer’s plan or into an individual retirement account (IRA). This makes it easier for individuals who switch jobs multiple times throughout their career or take time off from work in order to access the money that has already been contributed toward their retirement savings without penalty or taxes owed on any required minimum distributions taken before age 59 1/2.
  6. Loan Provision: With many plans, borrowers have the option of taking out a loan against their own 401(k) account balance should they need immediate access to funds in an emergency situation without incurring a 10% early withdrawal penalty that is imposed by traditional IRAs and other types of accounts when taken prior to age 59 1/2.

Types of Users That Can Benefit From 401(k) Providers

  • Employers: 401(k) providers offer a range of services to employers such as setting up retirement plans, providing administrative and compliance guidance, and helping employees with their investment decisions.
  • Employees: 401(k) providers can help employees maximize their own retirement savings by helping them understand their options and selecting the best investments for their needs.
  • Financial Advisors: 401(k) providers can provide financial advisors with access to a wide array of investment products that they can use to create tailored advice strategies for clients.
  • Business Owners: For business owners, 401(k) providers can help structure employee benefits packages to attract top talent while also allowing them to save on taxes.
  • Tax Professionals: Tax professionals who specialize in retirement planning can use information from 401(k) providers to advise clients on which plan best fits their needs.
  • Retirement Plan Administrators: Retirement plan administrators are tasked with overseeing plan activities and performance. They rely on 401(k) providers for assistance in monitoring participant accounts, managing compliance requirements, and ensuring plan sponsors remain compliant with regulations.

How Much Do 401(k) Providers Cost?

The cost of 401(k) providers can vary greatly based on the services provided and the size of the employer's plan. Generally, there are two main components to consider when calculating the cost: administrative fees and investment costs.

Administrative Fees: Administrative fees typically include expenses such as record-keeping, compliance, customer service and other services related to managing an employer's 401(k) plan. These fees can range from around $50 per employee up to $1,000 or more depending on how complicated a particular plan is; however, these fees are usually paid out of assets within the plan rather than by employers directly.

Investment Costs: Investment costs include any trading commissions charged by mutual funds and other investments in a 401(k) plan. These costs can vary greatly depending on what type of investments are included in the plan, but they typically range from 0.25%-2% of total assets in the plan each year. Employers may also have to pay various additional fees for things like filing documents or outside consulting services if necessary.

Ultimately, it is impossible to give an exact answer as to how much 401(k) providers will cost since it will depend on a variety of factors unique to each employer's situation. However, most employers should be able to get an idea of their expected costs after consulting with a provider and discussing their individual needs and goals for their retirement plans.

Risks To Be Aware of Regarding 401(k) Providers

  • Risk of Investment Losses: The investments available in the plan are subject to market risk and can result in losses, including losses of principal.
  • Risk of Higher Fees: Some companies charge higher fees than others for the same services. It may be beneficial to compare fees between providers before making a decision.
  • Risk of Fraud/Mismanagement: There is a risk of fraud or mismanagement when selecting a provider. Companies should conduct thorough background checks and make sure the provider is reputable and experienced.
  • Risk of Inflation: Over time, inflation can reduce the purchasing power of the invested funds, which may make it more difficult to retire comfortably.
  • Risk of Poor Investment Options: If there are too few investment options offered by the provider, it may limit your diversification and potential return on investments.
  • Risk of Changes in Regulatory Environment: The 401(k) industry is highly regulated, and changes in laws can impact how these plans operate, so it’s important to keep up with the regulations.

What Software Can Integrate with 401(k) Providers?

There are many different types of software that can integrate with 401(k) providers, including accounting and payroll programs, human resources management software, budgeting and financial planning tools, investment tracking services, and even mobile apps. Accounting and payroll programs allow companies to manage their employee benefits directly from a single solution. Human resource management software helps HR departments streamline tasks like setting up 401(k) plans or making changes to existing accounts. Budgeting and financial planning tools provide insights into where money is being invested and how it's helping an organization reach its goals. Investment tracking services make it easier to monitor the performance of company stock in a 401(k) plan. Finally, mobile apps have become increasingly popular for accessing retirement benefits information on the go.

What Are Some Questions To Ask When Considering 401(k) Providers?

  1. What investments are available in the plan? Are they low-cost, high-quality options that fit the 401(k) goals?
  2. Is there a minimum dollar amount required to get started?
  3. How frequently will an employee be able to contribute or make changes to their account?
  4. Is there access to a variety of asset classes, such as bonds, stocks, and mutual funds?
  5. Does the provider offer automatic rebalancing features?
  6. What type of reporting and monitoring capabilities does the provider have in place for plan administrators and individual account holders?
  7. Is there support staff or other resources available for help with enrollment or other questions about the 401(k)?
  8. Does the provider charge any fees associated with managing the plan (e.g., recordkeeping, administration)? If so, how much do these fees amount to, and what services are included in them?
  9. What types of educational materials or tools is the provider offering to help employees understand personal finance concepts related to retirement planning and investing in general?