BrightScope Inc., publicly launched early in 2009, maintains a comprehensive database of information on the 401k plan market for the express purpose of rating qualified defined contribution plans across the country. Currently BrightScope Inc. is the only 401k analytics firm that is truly independent and does not accept compensation in the form of revenue sharing from mutual fund companies or plan providers. Instead they align themselves with plan sponsors and look to provide ratings and financial information to plan sponsors, advisors and employee participants across the country. They make money by providing subscription-based analytics and benchmarking software and tools to plan sponsors, advisers and providers.
They use over 200+ individual data points in broad categories such as total plan cost, company contributions, vesting schedules, and quality of investments offered in each plan. Their information is obtained from a wide range of public sources and also directly from the plan sponsors. BrightScope’s mission statement is to increase the retirement security of America’s workforce by bringing transparency and efficiency to the 401k plan market.
Their website is extremely easy to navigate. Just input the company’s name and run a search. The BrightScope rating is displayed in the form of a single number from 0 (lowest) to 100 (highest) revealing the quality of the plan. You can also see how that score compares to your plan’s peer group, so you can see how your plan rates versus companies of similar size or industry group. In addition you can view plan information from the most recent Form 5500.
BrightScope believes their rating will ultimately lead to more cost-effective plans, increased employee participation, higher employee satisfaction and better outcomes for employees who depend on their 401k plan for retirement.
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Comments
The mission of every plan sponsor (employer) should be to set up a truly low cost plan that has a mix of investments which at least match the market's performance.
Easy!
By completing five simple steps, employers can ensure that everyone who touches the plan will be on the same page. It ensures you will have an effective system of checks and balances.
If you can read and add and subtract, you can complete all five of these steps in not more hour:
Step 1: Draft the guidelines for the plan's documents.
Step 2: Select the plan's investments.
Step 3: Hire the plan's vendors.
Step 4: Manage the plan. Complete each step in the guidelines you drafted to ensure that your plan is truly low cost.
Step 5: Monitor the plan: Complete each step in the guidelines you drafted to ensure your 401k is successful.
Best wishes to your readers,
Did this help you? For more free training on setting up, managing, and monitoring a 401(k) plan fast, Google Frank Cirullo.
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