With the implementation of rules that will finally allow Pooled Employer Plans (PEPs), expect more and more retirement plan providers offering micro plan solutions for small employers.
Why the move to offering better solutions for micro plans? There are a lot of plan providers that are wary of PEPs and concern (as I have pointed many times before) that many will fail because they won’t reach the asset size to guarantee cost savings. That’s why these wary providers are heading their bets because by offering better terms for micro plans, they feel they will eliminate the need for PEPs. While that might seem like a great solution, that doesn’t helo with one of the benefits of PEPs that most providers will not advertise about and should, which is the delegation of fiduciary authority to a pooled plan provider.
We are less than a few months away from PEPs and time will tell whether a PEP or micro plan better pricing is the way to go.