Why Advisors Are Paying Attention to Pooled Plans — and When a PEP Makes Sense
Pooled Employer Plans (PEPs) are not a new concept in the retirement industry—but they are entering a new phase of relevance.
What began to help employers reduce administrative burden is now a PEP rally. Advisors are increasingly looking at PEPs not just as a solution for clients, but also as a way to rethink how they deliver value, scale their practice, and engage in meaningful conversations.
The shift is subtle, but important.
- PEPs Are Evolving – In addition to reducing administrative work, advisors are increasingly using PEPs to manage regulatory complexity, support understaffed sponsors, and expand, without sacrificing service quality.
- Advisor Value Shifts—It Doesn’t Disappear - PEPs reallocate administrative and fiduciary responsibilities, freeing advisors to focus on higher impact work like strategic guidance, plan design, and long term participant outcomes.
- The Right Fit Matters More Than Ever - PEPs are gaining traction across businesses facing audit pressure, rising costs, or limited bandwidth. Advisors who recognize these signals can lead insight driven conversations and deliver better aligned solutions.
From compliance tools to practice evolution.
When PEPs were first introduced under the SECURE Act, the focus was straightforward. Their value centered on bringing multiple employers into a single retirement plan to streamline administration, simplify compliance, and reduce costs.
That still holds true. But today, advisors recognize that PEPs can help address the broader challenges of:
- Increasing regulatory complexity
- Serving clients with limited internal HR resources
- Balancing service quality with business goals
Rather than solving a single problem, PEPs are increasingly being viewed as a structural approach to managing retirement plans more efficiently.
The PEP momentum is real.
The expansion of PEPs is no longer theoretical. Industry research indicates continued expansion and rising employer adoption across a wide range of plan sizes and demographics.1 This increase is changing client conversations.
Employers are comparing plan structures more actively than before and looking for ways to reduce operational strain. For advisors, the key is knowing when a pooled structure is worth evaluating a specific client.
The advisor practice can evolve in pooled plans.
As of recent industry surveys, advisors increasingly report using pooled employer plans (PEPs)2, and that share is expected to rise significantly over the next several years. Research also indicated that advisors who already incorporate PEPs into their practice often manage larger books of business and are more likely to position themselves as strategic partners than plan operators.
That distinction is key.
PEPs do not eliminate the advisor’s role.
Pooled retirement plans can free advisors to focus where they make the greatest impact—strategic guidance, thoughtful plan design, and long term outcomes.
By shifting much of the operational and administrative work off the advisor’s plate, PEPs create space to deepen client relationships and engage in higher value conversations that drive better results. A common PEP misconception is that they reduce control or diminish the advisor’s role. In reality, responsibility is reallocated—not removed. While the pooled plan provider handles administrative and certain fiduciary functions, advisors remain central to strategy, participant success, and client advocacy.
Many advisors adopt PEPs precisely because they can reallocate certain fiduciary and administrative responsibilities to professional pooled plan providers, while retaining advisory responsibilities.
PEPs adoption is accelerating – and why that matters.
While PEPs were initially positioned for small employers, adoption is expanding.
One area of notable market expansion is among mid-sized plans, particularly those approaching audit thresholds or experiencing increased administrative complexity. For these employers, the value of outsourcing certain responsibilities can be more immediate and tangible.
At the same time, PEPs remain a strong entry point for new plans. For businesses considering offering a retirement plan for the first time, a pooled structure may provide a more streamlined path to implementation.
In both cases, the advisor plays a central role in evaluating if a pooled plan is the right fit versus a traditional 401k plan, explaining trade-offs and helping clients make informed decisions.
When is a PEP the right fit for your client.
As employer awareness grows around the benefits of PEPs, the advisor’s role increasingly shifts from explaining what a PEP is to knowing when it makes sense.
Most companies do not ask for a pooled employer plan by name. Instead, they describe challenges—too much time spent on administration, rising costs, limited internal resources, or concern about fiduciary responsibility.
Recognizing these signals early allows advisors to lead proactive, well timed conversations, rather than react after dissatisfaction has already set in.
When advisors should recommend a PEP.
Employers that benefit most from pooled structures tend to share a common set of needs. Listening for these PEP fit indicators can help advisors determine whether introducing a PEP will add real value or whether a traditional structure remains the better fit.
A PEP may be worth exploring when one or more of the following surfaces in client conversations:
- Sponsors feeling overwhelmed by notices, payroll coordination, testing, or audits
- Cost sensitivity, particularly around rising admin or audit expenses
- Sponsor fatigue, driven by ongoing compliance demands and regulatory pressure
- Limited internal bandwidth, where retirement responsibilities compete with other HR priorities
- Desire for simplified vendor management, due to frustration coordinating multiple providers
- Need for fiduciary risk support, especially concerns about liability or audit exposure
- An expanding workforce, where administrative demands increase
Hearing even a few of these criteria often indicates that a pooled structure is worth evaluating.
Lead the conversation and the PEP movement.
Effective conversations start with the employer’s experience—not plan mechanics. Advisors should lead by acknowledging what clients are already feeling: mounting administrative demands, rising costs, limited bandwidth, or fiduciary concern.
Framed in this way, PEPs are introduced not as a replacement product, but as an alternative, collaborative structure—one that keeps core plan design intact while shifting much of the operational and fiduciary burden to a professional provider.
Once interest is established, advisors can review factors like administrative time commitments, audit exposure, internal resources, vendor complexity, and fiduciary risk to validate whether a pooled structure truly fits.
This approach strengthens credibility, ensures the right recommendation, and reinforces the advisor’s role as a trusted partner—guiding clients toward solutions aligned with their realities, not prescribing one size fits all answers.
From there, joining a PEP becomes as straightforward as any other plan adoption.
The advisor PEP rally is here at Ascensus
The PEP market continues to evolve, with broader adoption, expanded plan options, and deeper advisor integration shaping what comes next. As retirement conversations become more strategic, plan structure is no longer a background consideration—it’s a key lever. Advisors who engage sooner rather than later are better positioned to guide clients through changes and identify opportunities that strengthen both outcomes and relationships.
PEPs are redefining how advisors operate. Those who lean in are finding new ways to create value—by simplifying administration, reallocating responsibility, and focusing on higher impact guidance. But advisors don’t have to enter this movement alone. Backed by Ascensus, advisors can access pooled plan structures, supported by shared governance, professional oversight, and proven expertise, helping advisors lead with confidence. The question is not whether PEPs will shape the future; it’s how you choose to lead it.
When we stand together, retirement gets stronger for everyone. Contact Us to Join the PEP Rally
This material is for informational and educational purposes only and does not constitute legal, tax, or investment advice. Pooled employer plans (PEPs) involve complex fiduciary and regulatory considerations, and outcomes will vary based on plan design and provider structure. Advisors and plan sponsors should consult with their own legal, tax, and professional advisors before making decisions regarding retirement plan structure or fiduciary responsibilities.
1The PEP Market: Expectations, Reality, and What Comes Next - Cerulli Associates, March 2026
2Advisor Innovation and Growth Trends Revealed at NAPA 401(k) Summit, April 2025