RealTime IT News

Internet 401k Plan Developed for Small Businesses

Citing growth in other online investment markets, Fidelity Investments Tuesday announced plans for a 401(k) plan that will be offered, sold, and serviced over the Internet.

Set to roll out this summer, Fidelity "e401k" will be initially targeted to small businesses that are technology-savvy, offering personal computer and online access to their employees.

Companies can design the plan according to their needs by specifying the company match, profit sharing, vesting schedules and eligibility. Additionally, e401k will offer a menu of about 35 mutual fund investment options from Fidelity, including diversified equity, fixed-income and money market funds.

Online services include plan administration by the employer, recordkeeping reports, personalized communication, education, retirement planning tools, plan enrollment and ongoing account monitoring and management.

"[e401k] contains all the elements that make up a very strong 401(k) plan and offers the ease of access and security we have built in to our Internet service channel," said Guy Patton, executive vice president of Fidelity's small business 401(k) unit.