PLANADVISER - May/June 2021 - 12

trends
PEPs' Predicted Growth
Advisers 'on the fence' may have several reasons to change their minds
mitigation and day-to-day
work efficiencies. "
Nasrin
Mazooji,
vice
president of compliance and
regulatory affairs at Ubiquity
Retirement + Savings,
says
she
is hopeful
that,
as PEPs grow, plan compliance
failures will decrease,
which would be a positive for
sponsors and advisers alike.
" Many
operational
components
that are monitored by
plan sponsors today will be
delegated to 3(16) fiduciaries
and PPPs that are likely
competent professionals with
years of experience in identifying
and preventing possible
plan failures. "
As to how retirement plan
advisers can educate themselves
about PEPs, Ari Sonneberg,
chief marketing officer
and a partner in The Wagner
Law Group, says his practice
has been issuing informative
newsletters, " which have
garnered enormous interest,
MUCH has been said so far about the importance of the
nascent pooled employer plan (PEP) market. Recordkeepers,
investment managers, third-party administrators
(TPAs) and retirement plan advisers and consultants alike
are all expected to take different roles in PEPs: as sponsors,
administrators, registered pooled plan providers (PPPs) or
fiduciaries.
Yet, industry experts and recordkeeping executives say
they have heard few inquiries from advisers about PEPs thus
far. Nonetheless, industry experts expect that the option
will have a big impact on the retirement planning industry.
Aon Retirement Solutions worked for a number of years
with elected and regulatory officials to help shape the
Setting Every Community Up for Retirement Enhancement
(SECURE) Act and the introduction of PEPs, says Rick Jones,
a partner in the firm. Aon launched its first PEP in January.
" Beyond Aon, we see increasing interest and buzz on PEPs
in the retirement plan and financial services industries, " he
says. " The 401(k) and PEP landscape will change dramatically
in the coming years, and we anticipate that advisers
will become increasingly supportive of PEPs as they better
understand the associated cost savings opportunities, risk
as well as [providing] webinars, which have also featured
members of our firm. "
However, pointing to some earlier adviser sentiments
about the plans, Sonneberg says, " I think there are mixed
feelings among advisers when it comes to PEPs, and many
are still on the fence. On the one hand, I think many
advisers are excited about the prospect of being in a position
to assist clients by helping them evaluate and select a PEP
to help lower the costs of sponsoring a retirement plan and
to offload and simplify some administrative responsibilities.
At the same time, many advisers are concerned about the
inherent loss of flexibility, as it applies to plan features and
plan investment selection, which comes with the transition
from a standalone 401(k) plan to a PEP. "
Still, Sonneberg says, he thinks plan advisers who are
conscientious and aware of their plan sponsors' struggles
with plan costs and administration will eventually recommend
those clients switch to a PEP. In fact, the expanded
use of PEPs can serve as a boon for advisers' businesses, he
says, as some may offer their own PEP. PEPs may also allow
registered investment advisers (RIAs) to manage more plan
assets, he says. -Lee Barney
12 | planadviser.com May-June 2021 Art by Katherine Streeter
http://www.planadviser.com
PLANADVISER - May/June 2021

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