Envestnet buys 401kplans.com, expanding retirement offerings

Envestnet buys 401kplans.com, expanding retirement offerings
The company said the deal underscores its ongoing commitment to the retirement plan industry and to investing in technologies that enhance its 'financial wellness ecosystem.'
JUN 01, 2022

Financial technology provider Envestnet Wednesday announced its acquisition of digital marketplace 401kplans.com.

Envestnet said the deal underscores its ongoing commitment to the retirement plan industry and to investing in technologies and solutions that enhance its “financial wellness ecosystem.” Envestnet manages data on retirement assets from more than 200,000 retirement plans.

"401(k) plans remain the primary savings vehicle for 60 million American workers, yet advisers are often reluctant to incorporate them as part of their practices and holistic planning processes. By bringing 401kplans.com into our retirement offering, we can create a more seamless experience for advisors to shop, benchmark, and screen investments for their retirement plan clients," Andrew Stavaridis, Envestnet's chief relationship officer, said in a statement.

401kplans.com streamlines retirement plan distribution and due diligence among financial advisers and third-party administrators. The company boasts nearly 28,000 advisers with accounts on the platform and working relationships with many of the largest broker-dealers.

401kplans.com was founded by Scott Buffington, former national sales manager of MassMutual Retirement Services. Buffington will join Envestnet as head of retirement sales, reporting to Sean Murray, who was named Envestnet’s head of retirement solutions last November.

"What would typically take advisers several weeks to complete can now be accomplished in a matter of minutes with a couple of clicks on our digital platform," Buffington said in the statement. "This offering is unmatched in the industry and serves as a platform for all advisers — from retirement plan novices to industry veterans — to help them efficiently find the best providers, assess fees and select appropriate investments for their clients."

Terms of the deal were not disclosed.

“It’s a good move in this competitive market, where pricing is paramount,” said Dennis Gallant, senior analyst at financial technology consultant Aite-Novarica Group. “It adds value to advisers in playing the fiduciary role to the fullest, as well as being a nice feather in Envestnet’s cap.”

Doug Fritz, president of financial technology consultant F2 Strategy, agreed the purchase will help advisers manage 401(k) plans. However, he has concerns about Envestnet’s ability to integrate the new offerings, especially given increased demand from advisers.

“Acquisition does not equal innovation, and integrating new technologies has always been a sticking point for Envestnet,” Fritz said, adding that Envestnet’s most recent acquisition offers no answers regarding the widespread speculation that the company itself is up for sale.

“401kplans.com is a nice addition to Envestnet,” he said. “But does it take Envestnet off the market? I don’t know.”

What's the 'one thing' advisers need to do to increase their business? Ed Slott has the answer

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