Startup partners with brokers on small business 401(k)s

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San Francisco-based 401(k) provider Human Interest on Wednesday rolled out a new partner program and portal aimed at helping benefit advisers manage retirement plans for small businesses. Advisers can use the company’s program to manage clients’ 401(k)s, by giving them the ability to refer small businesses, track referrals, manage revenue-share agreements and update contact, payment and other user information.

“We feel like our benefits partners are going to be able to confidently refer, track and manage their small business clients on a go-forward basis and really close the gap in their group benefit offerings,” says Trevor Wallace, senior business development manager at Human Interest.

Human Interest specifically focuses on 401(k) plans for small employers, companies with 250 employees or fewer — a group that often doesn’t provide retirement plans to workers, Wallace says. It’s an important demographic to focus on, the company says: Many plans are geared toward large companies and may be too expensive for a small business. In addition, Wallace says, the administrative tasks that come with setting up and managing a plan can be burdensome for a small company.

“These smaller businesses don’t even really realize what you have to do, what needs to be managed in keeping 401(k) compliance,” he says.

The company’s new program also offers HR and compliance services to new plans or plans with less than $50,000 in assets. Human Interest also can act as a 3(38) or 3(21) fiduciary to accommodate different investment strategies, the company said in a statement.

Human Interest has partnered with benefits consulting firm Sequoia Consulting Group on the sales and administration of 401(k) plans for small business clients. Wallace says Human Interest will use the portal to set up consultations for Sequoia’s new clients and implement and track their 401(k) plans. They have also partnered with Countsy, an accounting and HR service for startups.

“We’re really lifting the sales burden in a lot of ways [as well as] the implementation of the 401(k) plan. So anything from plan design to setting up custom plan features, all of that stuff we’re going to do on behalf of Sequoia,” Wallace said.

Human Interest currently has more than 1,000 small businesses and startups using their service for retirement plans, including video-based fitness training app Cody and roommate finder Roomi. For employers the plans cost a base price of $120 plus $4 per employee per month.

The company will be making additional changes to the program in the coming weeks, Wallace says. One of the new features will include the ability for brokers to create a customized plan proposal.

“It’s kind of a first step in an iterative process,” he says. “We’re going to be adding a lot more value to the product overtime.”

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Retirement planning Retirement benefits Retirement income Small business Financial planning