Vestwell is deepening its partnership with Commonwealth Financial Network with a new pooled employer plan solution for advisors working with business owners.
The Gateway 401(k) Plan, available exclusively to Commonwealth’s network of approximately 2,200 advisors, seeks to reduce administrative complexities while expanding access to retirement solutions for small- and mid-sized businesses.
This collaboration extends Vestwell’s existing role with Commonwealth, where it has provided recordkeeping and third-party administrative services. The new plan aims to scale these efforts, with FuturePlan – Ascensus's third-party administrator – providing compliance, testing, and plan design services.
Vestwell will serve as the pooled plan provider, handling the plan’s core administrative tasks, including payroll and recordkeeping, while Commonwealth will act as the fiduciary for investment management.
The New York-based fintech firm first threw its hat in the PEP ring in 2021, just as the market for PEPs was taking shape.
"We’re seeing increased demand from our affiliated advisors and their clients for retirement plan solutions with streamlined processes that reduce administrative burdens,” Mat Powers, vice president of strategic retirement solutions at Commonwealth, said in a statement announcing his firm's new initiative with Vestwell.
PEPs, such as the Gateway 401(k), are gaining popularity due to their ability to lower costs and operational burdens for smaller businesses. These plans pool multiple employers under a single retirement plan structure, which can help smaller companies offer competitive retirement benefits without the regulatory complexities of managing an individual plan.
While they had the potential to be adopted by larger plans, the original intent behind them was to help bridge the savings gap for 60 million Americans at smaller businesses who didn't have access to retirement plans at work.
“We spent a lot of time collaborating on this PEP solution, so it is exciting to bring this to life with a great partner like Commonwealth,” said Aaron Schumm, founder and CEO of Vestwell. “This will scale their advisors' businesses while generating more opportunities for everyone to access retirement savings programs."
Kasey Price, president of FuturePlan by Ascensus, also expressed enthusiasm, noting, "We’re delighted to expand our existing partnership with Vestwell and help offer exclusive access to a new PEP solution for Commonwealth Financial Network’s community of financial advisors."
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