Why TPAs Will Play a Role in Next Phase of PEP Growth
Pooled employer plans have become an increasingly important part of the retirement landscape. Employers and financial professionals continue to look for ways to simplify plan oversight, manage complexity and take advantage of scale, particularly as plan sponsors seek to reduce risk and streamline audit related responsibilities. PEPs respond to many of those needs, which may help explain the elevated interest in pooled arrangements.
As adoption grows, attention is shifting beyond participation alone to questions of how these plans are structured and how they fit within the broader retirement ecosystem. Pooled arrangements do not operate on scale alone. They depend on coordination between recordkeepers, financial professionals, investment managers and third-party administrators. Amongst those groups, third party administrators (TPAs) play a particularly important role, one that warrants careful consideration as pooled models evolve.
The core role TPAs play
TPAs often serve as the primary operational and technical specialists for retirement plans of all sizes, supporting plan design, administration and ongoing compliance requirements. In many cases, TPAs represent one of the most consistent service relationships within a sponsor’s retirement program.
Therefore, an important question for the industry is how to support TPAs as PEPs gain traction. As pooled arrangements mature, structures need to allow TPAs to remain engaged in their existing service model, particularly in areas where they provide day-to-day regulatory and operational support, while still participating in the growth of PEPs. Preserving this role can be valuable for financial professionals and sponsors who rely on both relationship continuity and expertise.
Why structure matters
This is where multiple-TPA pooled structures enter the conversation. Rather than requiring all participating plans to follow a single administrative model, a multiple-TPA approach allows different TPAs to continue supporting their clients within the same pooled framework. For TPAs, this structure is intentionally designed to reinforce their existing role, allowing them to provide ongoing administration and compliance support without taking on additional fiduciary responsibility by stepping into the role of a pooled plan provider.
This approach also reflects the reality that TPAs are not interchangeable. Different firms bring different capabilities, client profiles and areas of focus. A structure that accommodates diversity is designed to align more closely with how the retirement market operates, particularly alongside local and regional advisor relationships built over time.
Protecting relationships and supporting client growth
As client needs evolve, particularly for larger plans and those approaching audit thresholds, financial professionals and TPAs need ways to respond without disrupting longstanding relationships. Sponsors exploring PEP solutions are often looking for arrangements designed to address fiduciary exposure and audit complexity, not a change in who supports their plan on a day-to-day basis.
Against this backdrop, Lincoln Financial has introduced a pooled arrangement designed to support multiple TPAs within a single structure. The intent is not to advance a single solution, but to reflect a broader view that thoughtful structure and collaborative relationships may become increasingly important as PEPs mature.
Looking ahead
Indicators suggest that PEPs are more than a passing trend. Interest in pooled arrangements is expected to remain strong as plan sponsors and financial professionals look for ways to streamline complexity and mitigate risk.
The next phase of PEP growth will be defined not only by participation, but by how thoughtfully these programs integrate into the broader retirement ecosystem. An approach that recognizes the value of TPAs, and is designed to support their role, is likely to surface as a critical alternative to today’s solutions.
DISCLOSURE: 401(k) Specialist is not an affiliate of Lincoln Financial. Lincoln Financial is the marketing name for Lincoln National Corporation and its affiliates. Affiliates are separately responsible for their own financial and contractual obligations.
SEE ALSO:
• SEC Informal Guidance Clears Path for PEP Growth and CIT Access
• The Confidence Connection: How Retirement Consultants Empower Savers
• Advisors List Reduced Fiduciary Risk, Administrative Burden for Growing PEP Interest
Jason Crane is Senior Vice President, President of Retirement Plan Services (RPS), for Lincoln Financial. With more than 25 years of experience in the retirement industry, Crane leads Lincoln Financial’s RPS organization, which is dedicated to helping customers along every step of their retirement journey. Prior to joining Lincoln Financial in 2025, Crane served as Head of Core Retirement for Ascensus and held several executive positions with Transamerica. He is a current member of the Defined Contribution Institutional Investment Association (DCIIA) Executive Committee.