Vestwell, JP Morgan Announce Partnership

J.P. Morgan partnered with digital recordkeeper Vestwell to expand access to the platform for advisers in support of the bank’s small-business 401(k) platform, the firms announced Thursday .

J.P. Morgan selected Vestwell to expand the available recordkeeping platform options for advisers at the firm and to provide greater support for Everyday 401(k), the small-business workplace savings offering for clients, according to the release.

“As the retirement industry is experiencing unprecedented growth, we remain committed to offering best-in-class solutions for our clients,” said Steve Rubino, head of retirement at J.P. Morgan Asset Management, in the release. “Enhancing our offering by coupling a modern technology platform with an assigned client success professional, like Vestwell, will enable us to quickly and efficiently meet the increasing demand. Small businesses are seeking affordable and tech-forward retirement plans in record numbers, and we are proud to be able to deliver for them.”

Vestwell has experienced “unprecedented demand” from advisers that want to offer retirement plans to clients, Aaron Schumm, its founder and CEO, said in the release.

“These new partnerships and integrations signal the rapid growth across the savings industries with strategic interest from the world’s leading advisory and asset management firms,” Schumm said.

Vestwell had previously expanded its distribution partnerships with top advisory firms, including Commonwealth Financial Network and Cambridge, and investment researcher, according to the release, As Vestwell seeks to offer a “seamless recordkeeping solution for advisors and small businesses, the firm has expanded API integrations with leading payroll providers Gusto and Intuit QuickBooks.”

Vestwell serves 30,000 small businesses, 1 million retirement, education and healthsavers and accounts totalling $27 billion in assets in all 50 states, according to the company.

JP Morgan retained its small-business recordkeeping business, following the sale of the large-market recordkeeping division to then-Great-West in 2014.

A spokesperson for JP Morgan said, “We have 1,700 Everyday 401(k) plans funding or in onboarding [with] the typical Everyday 401(k) plan currently [at] less than 20 participants.”

Retirement plan offerings are growing in importance as more workers expect their employers to provide a plan. Almost three-quarters of workers (73%) agreed or strongly agreed that they expect employers to offer a 401(k) or 403(b) plan because of the tight labor market, and 98% of respondents think it is important for their employer to offer a retirement benefit for employees at the workplace, Vestwell research found in February.

Voya Financial Research shows a retirement plan is as important for employee retention as a competitive salary and work arrangement, according to November 2022 data finding that 60% of workers are more likely to stay with their current employer if they offer an employer-sponsored retirement plan.