Capital One has added Spark 401k, an all-exchange-traded fund 401(k) plan, to its products for businesses with fewer than 100 employees.

Spark 401k plans use model portfolios to simplify investment selection; plan sponsors can receive assistance from customer success managers and customer care agents in choosing and managing retirement benefits. Spark 401k also offers online plan management.

A Capital One representative said that the company takes “a diverse approach to distribution, using many channels to drive awareness of the offering.” While Capital One sells through advisors and broker-dealers, its primary sales channel is direct to small businesses. Ascensus and PAI are the recordkeepers for Spark 401k, and Capital One Advisors acts as the plans’ 3(38) fiduciary and investment manager — thus relieving the plan sponsor of fiduciary responsibility for investment decisions.

Spark 401k offers two customizable 401(k) plans that are designed for businesses with W-2 employees — a safe harbor 401(k) and a traditional 401(k) — in addition to providing an individual 401(k) plan for owner-only businesses. Spark 401k also oversees each plan’s investment fiduciary responsibilities.

The Capital One product is just the latest from a series of providers targeting the small-business market many doing so in anticipation of potential effects of the U.S. Department of Labor’s fiduciary rule. Platforms range from the robo —such as the one from Betterment for Business — to the bundled, such as J.P. Morgan Asset Management’s Retirement Link bundled defined contribution plan offering for the micro market.

In addition, there’s LPL Financial’s 3(38) fiduciary service, rolled out earlier this year, which is aimed at advisors who cater to the small plan market. While 401(k) plan sponsors, all of whom are fiduciaries under Employee Retirement Income Security Act, still maintain responsibilities to monitor 3(38) advisors, they are relieved of the fiduciary risk pertaining to investment decisions and that risk is transferred to the advisor.

Instant Insights /

Capital One adds 401(k) plans to small-business offerings

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