Paychex Retirement Services Review

Small business owners have a lot of options for managing their employees and benefits. They can use different vendors, stringing together their HR needs, or they can find an all-in-one provider. The latter is popular with small business owners for good reason: Keeping everything under one roof saves time, streamlines processes, and automates a lot of manual tasks. Small business owners who want an all-in-one solution for payroll and benefits need look no further than Paychex. Paychex has been in the business for decades and provides a full suite of payroll and HR services for small businesses. Its 401(k) offering is particularly robust, giving customers options such as traditional 401(k) plans, owner-only 401(k) plans, solo 401(k) plans, and SIMPLE IRAs. Paychex works with you to create a plan that meets your business’s needs. Through the Paychex Flex all-in-one HR platform, you can manage your retirement offerings, payroll, benefits and other HR functions in one place. 

Paychex Editor’s Score: 9.34/10

Why We Chose Paychex as Best for All-in-One Service

Paychex stood out to us as an all-in-one solution for a number of reasons. Let’s start with its HR platform. It’s a one-stop shop for your HR needs, including processing your payroll. We like how your Paychex payroll data integrates with your retirement plan, automatically updating behind the scenes. This way, you can improve your reporting accuracy, collect census data, ensure compliance, and meet fiduciary obligations. We were also impressed with how easy the platform makes it for employees to enroll in the plan and stay on top of their accounts. Our review of ADP found that it was the only other employee retirement plan provider to include direct payroll integration on the same platform.

Source: Paychex

Paychex is also one of the best employee retirement plan providers because it can bundle the recordkeeping and third-party administration to simplify plan management. It doesn’t hurt that Paychex holds the title as the largest retirement plan recordkeeper in the U.S. and provides a dedicated team of retirement specialists to help you select, implement, roll out and manage your employee retirement plan.

Did you know? Integrating your payroll and employee retirement systems can streamline operations and save you time. How many small business owners do you know who wish they had an extra hour or two in the day? You can learn more about Paychex’s other top services in our review of Paychex’s online payroll services and our Paychex Flex review.

What We Like About Paychex 

• Paychex offers an all-in-one platform to manage your business’s HR and employee retirement needs. 
• Paychex offers thousands of investment options for its employee retirement plans. 
• Paychex lets you customize your employee retirement plans to meet the unique needs of your staff. 

What We Don’t Like About Paychex

• Paychex is not transparent about its pricing on its website. 
• To get a quote, you have to be put in touch with a local affiliate, which adds a layer of complexity to the research and shopping process. 

Ease of Use 

We found that Paychex makes it easy for small business owners to implement and manage an employee retirement plan from the company’s digital dashboard and mobile app. Through the platform, employees can enroll in just four clicks. If you integrate payroll, you can automatically see who is eligible for the plan. We find this a valuable aspect of the service, because it makes it simple to determine employee eligibility. 

Once employees are enrolled, they have access to an online dashboard that gives them an overview of their accounts and lets them make changes, track progress, and manage their investment choices. The digital dashboard also simplifies the process of choosing investments, changing contributions, tracking loans and automating distributions. 

Source: Paychex

Features and Services

Paychex offers a lot of standout employee retirement features and services.  

Customization 

Retirement plans can be customized to fit your company’s specific needs, which we find a lot of value in. Each business is different, and this retirement service understands you may have unique requirements. 

Account Access 

Paychex’s employer website for its retirement plans is simple to navigate and makes it easy to access information about plan investments and participants. Employees can log in to their account dashboards to monitor their balances and manage their contributions. Paychex also has an easy-to-use mobile app through which employees can review their retirement accounts.

Fiduciary Support 

Paychex gives you the option of working with GuidedSavings from GuidedChoice to meet the ERISA 3(38) fiduciary requirement.  

Recordkeeping Services 

Paychex records and processes your employees’ contributions to the plan for you.  

Plan Administration 

Serving as the third-party administrator, Paychex creates and manages the plan document, checks eligibility and enrolls participants, conducts quarterly compliance testing, and processes employee loans.  

Payroll Integration 

If you already use Paychex as your payroll processor, you can directly integrate your retirement plan and payroll, streamlining administrative tasks.  

Reporting Requirements 

If you choose a 401(k) plan, you have to file Form 5500 with the IRS. As the plan administrator, Paychex prepares this form for you.  

Investment Options 

Paychex offers an impressive selection of investment options, including model portfolios, target-date funds, preselected lineups, and broker-specific rosters from Ameriprise, Edward Jones, Merrill Lynch and Morgan Stanley.  

Loans 

If you choose a 401(k) plan, participants may take out loans against their retirement savings accounts. Paychex processes them as part of its plan administration services.  

Mobile App 

Paychex makes it easy for employees to enroll in the plan or make changes with its mobile app. The app also keeps participants engaged with digital tools and investment information. 

Source: Paychex

Pricing 

Like some of the other services we researched, Paychex doesn’t post pricing for its retirement services online. The company requires you to fill out an online form and a representative will get back to you, typically in under an hour.  

When you connect with your local rep, make sure to inquire about fees for both you, as the employer and plan sponsor, and for your employees, as plan participants.  

These are some plan sponsor fees to ask about:

• Setup fees
• Monthly service fees (for recordkeeping, plan administration and fund custody)
• Investment management fees
• Plan termination fee

You should also ask if there is a service contract, how long the term is and if there are any early cancellation penalties.  

These are some plan participant fees to ask about:

• Assets under management (AUM) and advisory fees
• Average fund expense ratios
• Trading fees 

You also want to ask about incidental costs, such as loan origination and maintenance fees, distribution fees, and required minimum distribution (RMD) fees.

Tip: You want to keep the fees charged to you and your employees as low as possible. Before you offer an employee 401(k) or other retirement plan, make sure you know exactly how much you’ll pay for the plan and how much the investments will cost your staff.

Source: Paychex

Customer Service 

Paychex offers customer support by phone, email and live chat. We like that customers are assigned a team of retirement specialists to help them select the right plan. Paychex has been in business for more than 50 years and accredited with the Better Business Bureau since 2010, sporting an A+ rating. 

Limitations 

Paychex isn’t forthcoming about its pricing. It’s not on its website, which adds a step in the process of evaluating this vendor. While we recognize the company seeks to customize its services and pricing, some of its competitors make it easier to get this information. You can read our review of Human Interest to learn about such a service.

What Are Employee Retirement Savings Plans? 

An employee retirement savings plan is a pooled investment account sponsored by employers that lets employees set aside a portion of their pretax income for retirement. The plans are designed to encourage small business owners and their employees to save for retirement. 

Methodology

To choose an all-in-one plan provider, we started by looking for vendors that offer integration with payroll. That’s a big deal because it reduces the need to manually input employee information and the potential to make mistakes in the process. We further narrowed our list by reviewing the vendors that offer integrations beyond payroll. Time is money, and the more business tasks you can automate under one system, the better. The last thing a small business owner has time for is to move through different platforms to access employee retirement benefits, payroll and other HR responsibilities. 

Beyond integrations with internal and external services, we searched for vendors that keep plan costs for both employers and employees down, don’t make it too complicated to implement a plan, and are willing to work with you during setup and beyond. Small business owners and their employees need ongoing support, and we only considered vendors that offer that. 

Employee Retirement Plan FAQs

Will Paychex administer a 401(k) plan for my small business?

Paychex has a long track record of onboarding business owners and staff on thousands of 401(k) plans annually. It also can help you roll over an existing plan. Paychex handles the whole process, including filing documents, setting up payroll withdrawals, and enrolling employees in the plan. 

Why doesn’t Paychex provide pricing on its website? 

Paychex offers custom retirement employee plans that can integrate with its other software, such as payroll management. As a result, it does not list prices on its website, arguing that each customer is a unique situation. To get an accurate quote, you need to contact the company. 

Bottom Line

We recommend Paychex for …

• Small business owners who want an all-in-one solution for their HR needs. 
• Business owners who want access to a variety of retirement investment plans and more than 1,000 investment options. 
• Small businesses that appreciate and want a digital dashboard, but also human support.

We don’t recommend Paychex for …

• Business owners who do not plan to integrate their payroll with their employee retirement benefits plan. 
• Small business owners who care most about cost and need to know exactly how much they will be charged from the beginning. 
• Business owners who do not want or need customization.