Pooled employer plans (PEPs) have emerged as a compelling alternative to traditional retirement plans, offering employers a cost-effective and efficient way to provide retirement benefits. With retirement security remaining a key concern for both employers and employees, understanding the benefits and operational nuances of PEPs is crucial.

PEPs are gaining popularity as businesses seek cost-effective and scalable retirement solutions. The SECURE Act laid the foundation for PEPs, and SECURE 2.0 further strengthened this framework by mandating auto-enrollment for new plans, offering tax incentives for small businesses and promoting greater retirement access. By leveraging the collective power of multiple employers, a PEP offers several advantages that can make it an attractive option for businesses of all sizes, including cost savings, administrative ease and greater flexibility in plan design.

Almost half of US states have enacted state-sponsored retirement programs, with 10 requiring mandatory participation for certain businesses. While these programs expand access to retirement savings, they often come with limited investment options and administrative constraints. PEPs present a compelling alternative, providing employers with more flexibility, cost efficiency and competitive investment choices.

There are several reasons why a PEP might be the right choice for your organization. To learn more about how Gallagher can help ensure your retirement plan aligns with your organizational goals, delve into our whitepaper.

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