MutualFundWire.com: Merrill Taps Into Paychex's 401k Service
MutualFundWire.com
   The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication
Friday, April 9, 1999

Merrill Taps Into Paychex's 401k Service


Merrill Lynch is tapping into the latest trend in the defined contribution marketplace -- fund companies with strong distribution channels to small companies partnering with administrators with strong 401k products. Goldman Sachs has used ADP to distribute its funds to small plans for more than a year and recently American Express Financial Advisors paired with MetLife's small plan platform. Now, Merrill Lynch of Plainsboro, New Jersey is partnering with Paychex of Fairport, New York.

"Merrill Lynch will be using Paychex's recordkeeping services for its smaller 401(k) plan clients," Paul Davidson, director of retirement services at Paychex, told our sister publication, The 401kWire.com.

"How this all began is that we began our recordkeeping service a few years back. Through that service, we offered our clients investment options from a number of fund families including Merrill Lynch. Now, Merrill will be utilizing our recordkeeping for some of their plans," Davidson reported. The sales channel for this service will be the Plainsboro firm's Financial Consultants.

"This will be for small plans only. And by that we mean sponsors with fewer than 100 employees," he added. Current clients of Merrill with 100 employees or less will retain their current recordkeeping services. This new alliances will be for new clients only.

"This is a terrific opportunity for us," the official contended. "We have a much larger source for new business through Merrill Lynch's channel. Previously, all our clients came to use through the efforts of our sales force. The sponsors we have through our alliance with Merrill Lynch will receive exactly the same services as sponsors who come to us independently."

Paychex currently does not have an Internet application for its systems. It is a service to be introduced on the horizon, according to Davidson. He did not know at this juncture whether clients of the alliance would be accessing online services through a Merrill Lynch website or a Paychex website.


Printed from: MFWire.com/story.asp?s=24755

Copyright 1999, InvestmentWires, Inc.
All Rights Reserved
Back to Top