The Future of Retirement May Be Pooled: The PEP Adoption Trends Advisors Should Know
Pooled employer plans (PEP) are becoming harder to ignore.
What began as an alternative plan design is now drawing broader consideration, particularly among advisors working with future-focused organizations that face resource constraints. For these employers, PEPs can offer a different approach to plan administration and growth. This pooled employer plan trend also reflects changing expectations around efficiency, governance, and the role advisors play in helping clients evaluate plan structures.
At Ascensus, we’re harnessing the pooled plan momentum and started the PEP Rally to help advisors turn PEP adoption trends into high-energy and effective client conversations. Here, we’ll focus on how pooled employer plans are changing things—and what advisors should do with it.
- PEPs Are Moving Mainstream – Recent data shows the increasing adoption of PEPs, suggesting evolving employer expectations around efficiency, governance, and plan design.
- Real World Pressures Drive Adoption - Administrative complexity, rising costs, fiduciary risk, and limited internal bandwidth are pushing employers to reconsider traditional 401(k) structures.
- Advisors Have a Strategic Opportunity - As PEP momentum builds, advisors who understand these trends can lead more effective conversations that align with client realities and workforce goals.
What’s driving pooled plan adoption?
By the end of 2025, PEPs had reached $21 billion in assets, more than one million participants, and roughly tens of thousands of adopting employers1.
PEP growth isn’t a novelty. It’s a necessity and a thirst for choice.
Employers face more administrative complexity, greater scrutiny around fiduciary oversight, and rising expectations to run benefits with efficiency. In that environment, PEPs are being increasingly viewed as a practical way to simplify, safeguard, and scale retirement plan management. For advisors, it signals new client priorities—not just a new product to know about, rather a new operating model to discuss.
PEP trend #1: Operational complexity and employer bandwidth
One of the strongest PEP adoption drivers is also the easiest to understand: capacity.
Most employers don’t want additional tasks layered onto their already stretched teams. They want fewer vendors to coordinate, fewer manual processes, and fewer internal resources tied up in compliance and administration. That desire is pushing employers to evaluate whether their current plan structure still fits how they operate today.
Importantly, this inclination is not restricted to one employer segment. While small and first time plan adopters remain a key audience, established employers are also transitioning from standalone 401(k) plans as they reconsider how much internal effort they want to retain.
For advisors, remember the most effective PEP conversation often isn’t “Do you want a pooled plan?” It’s “How much administrative responsibility do you want?”
PEP trend #2: Cost pressure and efficiency expectations
Cost remains a powerful PEP driver, but the conversation has evolved beyond fees.
Employers are increasingly focused on total plan efficiency—from admin costs and investment oversight to governance and time spent managing the plan. PEPs address multiple pressure points by combining scale with centralized administration and fiduciary support, often delivering lower total costs than a standalone 401(k).
At the same time, competition among PEP providers is intensifying. Fee structures, service models, and investment frameworks vary widely, and that competition is pushing innovation and value across the market.
The advisor implication for PEPs
PEP trends reflect the convergence of sponsor demand for greater efficiency and simplicity, alongside growing competition to deliver more thoughtfully designed solutions. Advisors who can translate these dynamics into tangible business outcomes, fewer frictions, and better alignment — maybe via a pooled plan — are positioned to stand out.
PEP trend #3: Rising fiduciary risks
If there is one trend advisors should watch closely, it is fiduciary risk awareness.
Both advisors and their clients operate in a very risk conscious environment. But PEPs could be a way to reallocate and professionalize regulatory obligations—placing key administrative and fiduciary functions with dedicated pooled plan providers (PPP) who have specialists, ERISA experts, etc., while maintaining the appropriate fiduciary oversight.
This shift reframes the value of a PEP as more than just convenience. It’s also about governance, defensibility, and process discipline.
Advisors should ask their clients and prospects whether their current plan structure supports the kind of governance and documentation that today’s environment demands.
PEP trend #4: Employee value, engagement, and talent
While efficiency, fiduciary risk, and cost are obvious benefits, another popular PEP driver is how the retirement plan shows up for the employees it serves and supports broader talent goals.
PEP adoption is increasingly shaped by how employers think about their workforce. In a competitive market, retirement plans are no longer passive. They are part of the employee value proposition and a signal of long term commitment to employees’ financial well being.
By pooling employers into a larger structure, PEPs can offer access to more institutional quality investments, consistent plan design, and professionally managed oversight. This collective model helps employees see greater value in participation and plan features that might otherwise be out of reach in a standalone plan.
The result is a more credible, competitive retirement benefit that supports recruitment and retention. For the advisor, this connects plan structure directly to workforce strategy—helping employers assess whether their current plan encourages participation, builds confidence, and reinforces a sense of shared value.
What PEP advisors should do next
Successful advisors are increasingly treating pooled plan growth as a catalyst for client conversations with current and prospective clients:
- Talk to every client about PEPs—not because they’re right for everyone, but because the pressures they address are widespread.
- Start with clients experiencing administrative strain or governance fatigue.
- Focus on fit over fear: clarify when a pooled plan aligns with an employer’s priorities and when it doesn’t.
- Build credibility by staying fluent in PEP design, provider differences, and market trends.
The PEP drivers to watch
- Continued adoption growth — especially in small and mid markets — making pooled solutions a standard part of sponsor conversations, even without explicit PEP requests.
- Clearer differentiation among PEP providers, with flexibility, service design, and investment frameworks driving comparisons beyond fees.
- Potential consolidation as scale becomes critical, increasing the importance of provider due diligence and continuity planning.
For advisors, the opportunity of PEPs lies in understanding why pooled plans are growing and which clients are most likely to benefit.
Bring PEP trends into client conversations.
Advisors who understand the underlying drivers fueling PEP adoption are better positioned to guide clients toward plans that fit their needs, rather than defaulting to what’s familiar.
At Ascensus, we see PEPs as part of a broader evolution in retirement decision making, where sponsors are becoming more intentional about the employee experience. Advisors who recognize that shift are not just responding to change—they’re helping lead it.
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This material is provided for informational purposes only and is intended for financial professionals. It is not intended as legal, tax, or investment advice. Pooled employer plans (PEPs) may offer administrative and operational efficiencies depending on plan design, provider capabilities, and client circumstances. Advisors should evaluate each client's objectives, workforce needs, and fiduciary considerations when assessing potential fit. Any discussion of potential benefits is illustrative in nature and does not guarantee specific outcomes.
1The PEP Market: Expectations, Reality, and What Comes Next - Cerulli Associates, March 2026