Paychex Retirement Services Review and Pricing

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

Paychex stood out to us as the ideal all-in-one solution for a number of reasons, starting with its small business 401(k) options. These include traditional 401(k) plans, owner-only 401(k) plans, solo 401(k) plans, pooled employer plans and SIMPLE IRAs. Paychex works with you to create a retirement plan that meets your business’s and employees’ needs. 

Paychex also distinguished itself with the Paychex Flex all-in-one HR platform, where you can manage your retirement offerings, payroll, benefits and other HR functions in one place. It’s a one-stop shop for your HR needs, including for running payroll. We like how your Paychex payroll data integrates with your retirement plan information and updates automatically behind the scenes. This way, you can improve your reporting accuracy, collect census data, stay compliant and meet fiduciary obligations. 

We were also impressed with how easy the platform makes it for employees to enroll in a retirement plan and stay on top of their accounts. Direct payroll integration is not common among employee retirement plan providers. For example, in our review of ADP, we found that it was the only other employee retirement plan provider to include a direct payroll integration on the same platform.

Employees can enroll in a retirement plan in a few clicks through Paychex’s online platform, as seen in this demo screenshot. Source: Paychex

Another reason Paychex is one of the best employee retirement plan providers is that it can bundle recordkeeping and third-party administration to simplify plan management. Paychex holds the title of the largest retirement plan recordkeeper by total plans 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.

Ease of Use

During our review of Paychex’s retirement services, we paid particular attention to the usability of the employee-facing software. We found that Paychex makes it easy for small business owners to implement and manage employee retirement plans through the vendor’s digital dashboard and mobile app. Then, using the platform, eligible employees can enroll in a retirement plan in just four clicks. 

We liked that if you integrate payroll services, you can automatically see which team members are eligible to sign up for your retirement plan — one of the key advantages of Paychex’s all-in-one solution. Another important benefit, in our opinion, is the option for automatic 401(k) enrollment to increase employee participation rates. 

We found Paychex’s employee dashboard simple and intuitive to navigate. Once team members are enrolled, they have access to an online dashboard that gives them an overview of their retirement 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.

Paychex makes it easy for employees to manage their retirement plans via a user-friendly dashboard. Source: Paychex

Paychex Features and Services

The Paychex Flex platform stands out for offering the following employee retirement features and services.

Customization

We love that Paychex’s retirement plans can be customized to fit your company’s specific needs. Each business is different, and this provider understands that you may have unique requirements. However, this customization means you’ll need to get custom pricing from the vendor, which is largely why Paychex doesn’t list its pricing online.

Account Access

During our investigation, we tested how easy it was for both employers and employees to find important plan information. Paychex’s employer website for managing 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. 

Fiduciary Support

Another benefit of Paychex is the option to partner with GuidedSavings from GuidedChoice, a third-party company that serves as an ERISA 3(38) fiduciary. This partnership reduces your fiduciary liability, ensures compliance, and enhances your retirement plan by providing expertly managed investment options designed to help your employees achieve their financial goals.

Plan Administration

Serving as the third-party administrator, Paychex creates and manages retirement plan documents, checks eligibility and enrolls participants, conducts quarterly compliance testing, and processes employee loans. Paychex also records and processes your employees’ contributions to their retirement plans for you, thereby cutting down on manual work. If you choose to provide your staff with 401(k) plans, you have to file Form 5500 with the IRS. As the plan administrator, Paychex prepares this form for you.

Payroll Integration

If you already use Paychex as your payroll processor, you can directly integrate your retirement plan and payroll services to streamline administrative tasks. Payroll integration is a great way to save money by lowering overhead costs, ensuring that payroll complies with tax codes, and decreasing the number of vendors your business needs to hire. Paychex’s payroll integration can be combined with a pay-as-you-go workers’ comp plan to help your business save money on insurance premiums. 

Investment Options

We paid particular attention to Paychex’s investment options during our research. The company offers a variety of investment choices, including model portfolios, target-date funds and preselected lineups. Paychex also partners with well-known investment providers to offer a broad selection of mutual funds. The company’s retirement specialists can help answer questions on topics such as choosing between a traditional and Roth IRA.

Loans

With 401(k) plans, participants can take out loans against their retirement savings accounts. Paychex makes it easy to quickly procure a loan by including processing in its administration services. 

Mobile App

We like that Paychex offers multiple mobile apps that can be used by both employers and employees. The Paychex Flex mobile app makes it easy for employees to enroll in a retirement plan or make changes on their smartphones. The app also keeps participants engaged with digital financial tools and investment information. For employers and business owners, the Paychex app represents another tool to run a business from a smartphone. Paychex Flex is rated 4.8 out of 5 in both the Apple App Store and the Google Play store.

Paychex’s apps also include a variety of ways to manage remote employees, including time management features like a calendar, scheduling, vacation, and ways for employees to clock in and out. 

Managing an employee retirement savings plan is simple with Paychex’s mobile app. Source: Paychex

Paychex Pricing

Like some of the other employee retirement plan providers we reviewed, Paychex doesn’t post pricing for its retirement services online. To initiate a quote, simply answer two questions; a representative will reach out to you, typically in under an hour.  

When you connect with your local Paychex affiliate, make sure to inquire about fees for both you, as the employer and plan sponsor, and your employees, as the plan participants. Here are some plan sponsor fees to ask about:

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

Here are some plan participant fees to ask about:

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

You should also ask if there is a service contract, how long the term is, and if there are any early-cancellation penalties. You’ll also want to inquire about incidental costs, such as loan-origination and -maintenance fees, distribution fees, and required minimum distribution (RMD) fees.

Other retirement service providers we reviewed, such as Fidelity Investments, are known for offering low fees. We also found that companies such as USA 401k are more transparent about pricing than Paychex. Read more in our full review of USA 401k.

The Paychex platform allows you to customize contributions and other aspects of retirement plans. Source: Paychex

Implementation and Onboarding

We like that Paychex runs everything from the same dashboard, which makes it a breeze to implement retirement plan services for your team. The platform automatically pulls the required data and then sends an invitation to eligible team members with just one click. During our demo, we found employee onboarding to be straightforward. A series of prompts leads users through the process of establishing payroll deductions and investment options. We especially like how everything is simply laid out in the portal to make managing your retirement plans as user-friendly as possible.

Customer Service

Paychex offers customer support by phone, email and live chat. We like that businesses are assigned a team of retirement specialists to help them select the right retirement plan options for their staff. There are different customer support numbers for different services, but you can reach customer support Monday through Friday, from 8 a.m. to 8 p.m. ET, at 1-800-472-0072 for retirement benefit services.

Because Paychex specializes in assisting with payroll and other core human resources processes, its website is equipped with a wealth of helpful HR information, including a knowledge center, podcasts and webinars. There are even calculators you can use to assess different metrics. For example, a retirement calculator lets users plan out how much money they can save before retiring.

Paychex has been in business for more than 50 years. It has been accredited with the Better Business Bureau (BBB) since 2010 and sports an A+ rating. However, its customer score on the BBB website is only 1.02 stars out of 5. Paychex also scores a 1.1 out of 5 for customer service on the user-generated-review site Trustpilot. Although this is a low score, similar businesses, like ADP and Paycor, also have essentially the same score on Trustpilot.

Limitations

Paychex isn’t forthcoming about its pricing. Costs aren’t listed on the vendor’s website, which makes it challenging to evaluate whether the company’s services make financial sense for your business. Although we recognize that Paychex seeks to customize its services and, therefore, its pricing, some of its competitors make it easier to get cost information. You can read our review of Human Interest for one such example.

In addition, although we were pleased to see that Paychex is accredited with the BBB and has the highest possible rating, the vendor’s poor customer review score is concerning. The BBB readily admits that “customer reviews are not used in the calculation of BBB Rating,” which means Paychex’s A+ isn’t necessarily representative of actual customer experiences. In fact, in the past 12 months alone, the company had to resolve 165 customer complaints.

Methodology

To find the best employee retirement plan administrators for small businesses, we search for vendors that keep plan costs down for both employers and employees, don’t make it too complicated to implement a plan, and are willing to work with you during setup and beyond. When identifying the top solution for business owners specifically seeking an all-in-one platform for managing both retirement plans and other HR tasks, we started by looking for providers that offered integration with payroll. That’s a big deal, because it reduces the need to input employee information manually and limits the potential for mistakes.

We further narrowed our list by reviewing the vendors that offered integrations beyond payroll. Time is money, and the more business tasks you can combine under one system, the better. The last thing a small business owner has time for is moving through different platforms to handle employee retirement benefits, payroll and other HR responsibilities. Fortunately, Paychex eliminates those hurdles with its comprehensive, all-in-one Flex system.

Bottom Line

We recommend Paychex for …

• Small business owners who want an all-in-one solution for their HR needs, including employee retirement plan administration.
• Business owners who want access to a variety of retirement investment plans and more than 1,000 investment options.
• Small businesses that want both an online dashboard for employee retirement plan management and access to human support.

We don’t recommend Paychex for …

• Businesses that don’t plan to integrate their payroll data with their employee retirement plan information.
• Small business owners who care most about cost and need to know exactly how much they will be charged before contacting a vendor.
• Businesses that don’t want or need retirement plan customization.

Nathan Weller contributed to this article.