TPAs do the Heavy Lifting for the 401k and Retirement Plan Industry

 In Customer Onboarding, Fintech

With a background in financial services and corporate retirement, I have a deep understanding of how much administrative and compliance work is required to keep a corporate retirement plan running smoothly. The folks who do the heavy lifting in this industry are called Third Party Administrators (TPAs).

A TPA is a third party administrator for retirement plans. TPAs perform responsibilities such as retirement plan design, creating plan documents, preparing employer and employee benefit statements, ensuring that the plan is in compliance with the IRS non-discrimination requirements*, preparing annual returns and reports required by the IRS, DOL, and other government agencies, and much more. 401(k)s and other retirement plans can be highly technical; keeping up with the changes in the retirement plan industry is extremely time consuming.

* A quick side note about non-discrimination testing. In order to qualify for tax-favored status, a benefit plan must not discriminate in favor of highly compensated employees and key employees with respect to eligibility, contributions, or benefits.

Earlier I mentioned that TPAs do the heavy lifting for retirement plans and for complex situations; let me elaborate.  Consider a corporation with 10,000 employees and the amount of data and paperwork that would be required to keep a retirement plan running. Besides non-discrimination testing, keeping the plan in compliance and preparing annual tax filings, there is an incredible administrative burden associated with new employee enrollment data, employee terminations, distributions, loans, marriages/divorces/death, beneficiary changes, quarterly statements…You get the picture.  So much work goes into running a retirement plan and regardless of the company size, the same duties are applied to every plan.

You might wonder how this relates to the work that I am now doing at Liveoak Technologies. One of Liveoak’s most successful use cases to date has been with onboarding* corporate retirement plans. For your reference, here is a white paper that was written on the subject:

For your reference, here is a white paper that was written on the subject:

*What does onboarding a corporate retirement plan mean?



When a corporation signs up for and implements a new 401(k) plan for its employees, there is a lot of applications, forms, data transfer, plan sponsor and trustee signatures involved in the signup process. Throughout this process, the corporation’s financial advisor is also involved with setting up the plan and lining up the investment options, which also requires paperwork and signatures.




Completing paperwork, gathering signatures and transferring data takes a Herculean effort and often times can take several months to complete. Now with Liveoak’s digital customer onboarding platform, large financial service providers, third-party administrators, and financial advisors can complete the onboarding work in days compared to months.

“Leveraging the convenience of Liveoak, a retirement plan sales consultant helped an advisor and their client go from proposal request to signature in 68 minutes.”

Internal Sales Manager at John Hancock Retirement Plan Services

The natural progression for the retirement industry is to enable TPAs with the same tools so that they too can experience the benefits of digital transformation. Beyond providing customers with a digital experience, primary benefits include:

Accuracy: paperwork is complete and in good order (paperwork not in good order causes delays and heavy administrative burden)

Speed: a digital process vs. scanning, faxing, email, traditional and overnight mail

Savings:  less manpower required to accomplish the same tasks

Focus:  the ability to spend less time on administrative tasks and more time to focus on their expertise in compliance, best practices, and plan design

While preparing to roll this functionality out to the TPA community, we have been on the road listening to the needs of TPAs and how we can help them improve their business. As a result, team Liveoak is very excited about being able to make a positive impact on this industry.

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