MiMEP is a Multiple Employer Plan (MEP) that offers a fully customizable, turn-key retirement plan to employers at lower costs. This was made possible because of new regulations set by the Department of Labor in 2019, which allow employers with commonalities to band together and have their 401(k) plans be treated as a single retirement plan.

MiMEP is open to the more than 5,800 member employers, trade associations and local chamber of commerce organizations. The MiMEP is designed for businesses with between 2 to 150 employees and is now open for enrollment.

Based on the unique structure of this plan, fiduciary liability is transferred to the ERISA 402 and ERISA 3(16) fiduciary, and further to an ERISA 3(38) fiduciary via a contract executed between the plan custodian, adopting employer and 3(16) fiduciary. The advisor provides support to the adopting employer and becomes the liaison between them and the other providers. That means employees who were formerly acting as the plan administrator with a standalone plan can significantly reduce fiduciary liability.

A small business employer and their employees both win by participating. By pooling assets under one plan, Michigan Chamber of Commerce members can benefit from economies of scale and offer an attractive retirement savings option at a lower cost to their employees. Adopting employees will be offered a menu of investment options that allow for self-direction and will receive regular statements on their plan. MiMEP also allows for custom design, so that each adopting employer can implement provisions – such as eligibility and matching – that meet specific needs.

There is no onboarding fee if you have current 401(k) plan with assets. With new plans, there is a $1,000 onboarding fee for the plan startup, which the employer pays. Employers also are responsible for a $1,300 annual fee. Employee participants pay $70 per year, plus a Trust & Custody fee of five basis points a year and an annual financial advisory fee of 35 basis points for year.

For example, if MiMEP has 100 participants with $10,000 each in their accounts, participants would pay 40 basis points plus $70 per year, for a total of $110 per year, or only $27.50 per quarter.