Brooke Southall

I'm interested to see how this plays out.  The 401(k) administration area is highly saturated with long lead times. I honestly don't see the big differentiators in terms of business models, onboarding, or servicing at present, but wish them well.  Goldman's been dancing around this space for awhile now, so it'll be interesting to see if they bring anything unique to the table.

Goldman Sachs has always been one of those entities that you either love or hate, but after reading this story, I'm floored by what's going on now. It will be nice to see what Goldman will do that could shake things up a bit in the industry.

That's the sort of mentality and innovation I always love to see in companies.

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How Aaron Schumm got Goldman Sachs' brightest young star aboard; he jammed  in a meeting for a friend and accepted an offer he couldn't refuse--$30 million

Goldman Sachs

Vestwell

Aaron Schumm

The days when RIAs were the outsiders at the 401(k) party are fast coming to a close. What's new is that the mass of 401(k) assets 
is getting critical at about $3 trillion; fiduciary advisors are getting appreciated; fat fees and questionable kickbacks are getting exposed and stepping out of line is getting dicier as the Department of Labor tightens the regulatory screws.

The old reasons why the 401(k) business is attractive are still in place: there are fresh assets pouring in every month and when employees leave jobs or retire, they produce rollovers that build up IRA accounts for financial advisors. The drawbacks of getting into the 401(k) business are still in place, too. Dealing with retirement assets is really a second line of business and it remains -- unless you overcharge with hidden fees -- a low margin business with high potential fiduciary liabilities.

Still, the outsourcers, infrastructure and accumulated knowledge for RIAs to capitalize on is growing daily and a the mega-shift of assets away from brokers is making the 401(k) business riskier and riskier -- to ignore.

401(k) Stories

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The Vestwell CEO gets Rana Yared, the 35 year-old Goldman partner, on his board as part of the $30-million round she made happen

How Aaron Schumm got Goldman Sachs' brightest young star aboard; he jammed in a meeting for a friend and accepted an offer he couldn't refuse--$30 million

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