A surge of new 401(k) plans is on the horizon, driven by state mandates, SECURE 2.0 tax credits, and the growth of group plans like PEPs. With only 12,000 retirement plan specialists available, the nearly 400,000 new plans will largely fall to non-specialist financial advisors, payroll providers, benefits brokers, and insurance professionals.
However, most of these newcomers don’t want to become 401(k) experts or disrupt existing client relationships. Instead, they need a streamlined, low-effort solution—more like a rideshare service than car ownership. To meet this demand, broker-dealers, record keepers, and TPAs must evolve, offering integrated, turnkey solutions that simplify plan setup, fiduciary oversight, and participant services.
While firms like John Hancock, Vestwell, and Mariner are adapting, many traditional providers struggle with rising costs, shrinking fees, and outdated business models. To succeed, the industry must shift from a product-focused approach to a service-driven model—making it easier for non-specialists to offer retirement plans while ensuring ongoing support and compliance.
For more insights from Fred Barstein, read his latest column: “How to Handle the Expected Tsunami of New 401(k) Plans.”
