401(k) Providers
401(k) Providers Comparison
How to compare 401k products: the capabilities we check against each vendor’s own documentation, and the products verified so far.
LeadChange may earn a fee when you request pricing through our site or follow a sponsored link. Rankings never depend on whether a vendor pays us.We may earn a fee.
How we make money
LeadChange may earn a fee when you request pricing through our site or follow a sponsored link. Rankings never depend on whether a vendor pays us.
What we compare
No 401k product is verified yet. These are the capabilities each one will be checked against, in the vendor’s own documentation.
Capabilities in the comparison
Plan design and document
Supplies the written plan document and supports traditional, safe harbor and other plan designs.
Participant recordkeeping
Tracks contributions, earnings, investments, loans and distributions for each participant account.
Payroll integration
Syncs deferrals, compensation, hours and employee changes from payroll and flags late or failed contributions.
Investment menu and default investment
Provides the fund lineup and a default investment for employees who do not choose one.
Fiduciary services
Takes on defined investment or administrative fiduciary roles, stated in the service agreement.
Compliance testing
Runs annual nondiscrimination testing and supports corrections when tests fail or errors occur.
Form 5500 support
Prepares the annual Form 5500 or Form 5500-SF for the plan administrator to file.
Automatic enrollment
Enrolls eligible employees at a default deferral rate unless they opt out or choose a different rate.
Participant notices and education
Prepares and delivers required notices, fee disclosures and employee education.
Fee disclosure
Itemizes plan fees and who pays them, for the employer and for participants.
How to choose 401(k) providers
Choose a 401(k) provider on three things: which duties it takes on in writing, how cleanly contributions flow from payroll, and the total cost to the company and to participants. Plan features matter, but most problems come from gaps between payroll, recordkeeping and compliance.
The Department of Labor suggests surveying several providers and asking each for the same information. Bring your payroll system, headcount, employee turnover and the plan design you want to every demo, and ask for a written fee disclosure up front.
Plan types and design options
The IRS describes traditional, safe harbor and SIMPLE 401(k) plans, each with different contribution and testing rules, so the provider must support the design that fits your workforce.
Fiduciary roles in writing
The Department of Labor says hiring an investment manager relieves the employer of liability for that manager's individual investment decisions, but the employer must still select and monitor the manager.
Payroll integration and deposit timing
Employee deferrals must reach the plan on time, and for plans with fewer than 100 participants the Department of Labor treats deposits made by the 7th business day after withholding as compliant.
Compliance testing and corrections
Traditional plans must pass annual ADP and ACP tests, and failed tests or operational mistakes need prompt, documented correction.
Form 5500 and government reporting
The IRS says Form 5500 is due by the last day of the seventh month after the plan year ends and must be filed electronically through EFAST2.
Fee transparency
The Department of Labor groups plan fees into administration, investment and individual service fees, and says service providers must disclose their services and all compensation they expect to receive.
Requirements by company size
Small businesses
- Direct sync with your payroll system for deferrals and new hires
- Plan document, testing and Form 5500 preparation included
- Clear written statement of any fiduciary roles the provider takes on
Watch out for
- Asset-based fees that are hard to see on participant statements
- Fiduciary support described in marketing but missing from the agreement
- Setup and termination fees disclosed only in the fine print
Mid-sized companies
- Testing support with options for safe harbor or plan design changes
- Investment menu review and documented fiduciary process
- Controlling-group and multi-entity payroll handling
Watch out for
- Revenue sharing that hides the real cost of recordkeeping
- Integrations that cover deferrals but not hours or compensation
- Service teams that rotate without knowledge of your plan
Enterprises
- Recordkeeping at scale with data feeds from several payroll systems
- Support for plan audits and committee reporting
- Negotiated, itemized fees with benchmarking
Watch out for
- Bundled pricing that blocks you from changing funds or advisors
- Long conversion timelines and extended blackout periods
- Weak controls over participant data and distributions
Red flags
- The provider cannot give you a written fee disclosure before you sign
- Fiduciary roles are promised in sales materials but not named in the service agreement
- Contributions must be uploaded by hand after every payroll with no error checks
- No clear owner for nondiscrimination testing or Form 5500 preparation
- High surrender charges or exit fees on the investment products
- Claims that using the provider removes all of the employer's fiduciary responsibility
How we research
Ranked by the LeadChange Score, computed only from verified facts: capability coverage (30%), pricing and value (20%), integrations and API (15%), security (15%), fit and support (10%) and data confidence (10%), times a category fit. Products with too few verified facts are not scored yet and come last. Payment never changes a score or a position.
Facts, not impressions
Every input is a fact verified against vendors’ official documentation, with the date we last checked it.
Missing data is never assumed
Unverified items are left out of the score and lower its coverage; below 60% coverage a product is not scored yet.
Independent of revenue
Rankings never depend on whether a vendor pays us.
Get your 401(k) providers shortlist
Tell us about your team and get a shortlist ranked without regard to who pays us.