How Betterment at Work can partner with third-party administrators

Every retirement plan has its own priorities, constraints, and operational requirements. Some employers value a streamlined, bundled experience with one provider managing the recordkeeping and administrative work. Others may prefer to work with a specialized third-party administrator (TPA).

For retirement advisors, that choice matters. The right solution should support the needs of the plan and preserve the advisor’s ability to recommend the structure that makes the most sense for the employer.

That’s why Betterment at Work is designed to offer flexibility: It can serve as both the plan’s recordkeeper and administrator, or it can work alongside an external TPA.

Option 1: Betterment at Work as recordkeeper and administrator

For plans that want a more streamlined experience, Betterment provides an integrated solution. In this model, employers can work with one platform for core plan operations, while employees receive access to Betterment’s digital participant experience. Plan sponsors are also supported by Betterment’s client success team, which provides dedicated support from onboarding through ongoing plan administration.

This bundled approach can help reduce the coordination required across multiple providers. It may be a strong fit for employers looking for:

• A single, integrated retirement plan experience
• Streamlined plan administration
• Consolidated pricing
• Digital tools for participants and plan sponsors
• Dedicated, high-touch support from an experienced client success team

For most plans, Betterment can provide both recordkeeping and administration, with no need to bring in an outside TPA.

Option 2: Betterment at Work as recordkeeper, with an external TPA

Some situations may call for an external TPA. The most common are:

• Highly specialized plan designs that need customized administrative support
• Cross-testing with a cash balance or defined benefit plan, where the TPA can test separately held outside assets alongside the 401(k)
• Existing partnerships with a TPA and advisor

In those cases, Betterment can serve as the plan’s recordkeeper while an external TPA provides specified administrative and compliance services. Betterment continues to provide recordkeeping and other contracted platform services, such as participant engagement, while the external TPA supports the responsibilities outlined in the agreement.

Advisors often serve clients across a wide range of industries, workforce sizes, and plan designs. A solution that requires every employer to use the same administrative model can limit an advisor’s ability to pursue the right fit.

Here are some questions to consider with your clients:

• Would the sponsor benefit from a bundled structure with one provider and one support team?
• Does the plan sponsor already rely on a TPA it wants to keep working with?
• Does the employer offer a separate Cash Balance or Defined Benefit plan that needs to be cross-tested with the 401(k)?
• How will roles and responsibilities be divided?
• Does the proposed structure supports the plan’s fiduciary and operational needs?
• How do total costs compare with the value and complexity of the services provided?

The answer does not have to be the same for every client. Betterment gives advisors more room to recommend a solution based on each plan’s needs rather than a provider’s limitations.

Betterment’s bundled recordkeeping and administration is built to support plans as they grow, with the same integrated platform supporting the plan along the way. A flexible provider model does not replace the advisor’s role; it gives advisors more options to help employers build a retirement program that aligns with their goals.

Clear role definition is essential. An external TPA’s responsibilities depend on the agreement with the plan and should not automatically be treated as equivalent to the full 3(16) fiduciary role.

With Betterment at Work, advisors and their clients can choose the structure that best fits their circumstances. That optionality can help advisors serve more employers, respond to more complex plan needs, and recommend a retirement solution that is designed around the client’s priorities.

Ready to bring a 401(k) client to Betterment at Work? Get in touch.