Vestwell Debuts PEP for Small 401(k) Plans

Vestwell announced the debut of Vestwell Elite, a defined contribution pooled employer plan designed for small 401(k) plans.

According to the company, the offering is best suited for plans with more than 80 participants and less than $2.5 million in assets, because the PEP is intended to serve plans that just recently became large enough to face audits or are nearing audit status.

Once a plan exceeds 100 participants, it becomes subject to audit. Joining a PEP like Vestwell Elite can help small and midsize employers reduce both the cost and complexity associated with this requirement.

The costs of an audit vary based on plan size and other factors, but generally, an employer pays between $8,000 and $13,000, according to accounting firm Walters & Associates. Enrolling in Vestwell Elite reduces that fee to $1,000, according to Vestwell.

Vestwell will be the named plan fiduciary for Vestwell Elite plans, making the firm legally responsible for the plans’ oversight. Vestwell will also hold administrative responsibilities and plan onboarding and operations.

According to Vestwell, the PEP’s nonproprietary investment lineup is curated by Wilshire Advisors LLC, which serves as a 3(38) fiduciary investment manager.

According to Cerulli Associates, the PEP market’s total assets were $10 billion at the end of 2024.

“Vestwell was built to expand access to savings across every segment of the market,” said Aaron Schumm, Vestwell’s founder and CEO, in a statement. “Pooled Employer Plans are a powerful way to do that, bringing modern infrastructure, cost efficiency, and simplicity to employers of all sizes.”