About Us---Our 30+ Year History Providing 401(k) Plans to Small U.S. Businesses

Who (or What) Is 401(k) Easy?

SUMMARY:

401(k) Easy, founded by James Gilbert, has been a key player in the 401(k) industry since its inception over thirty years ago. The company aims to provide cost-effective 401(k) plans tailored for small businesses, avoiding hidden fees and offering a wide range of investment options.

• Founder's Background: James Gilbert's experience with Merrill Lynch and Dean Witter informed his vision for a more affordable 401(k) service.
• Innovative Approach: Gilbert identified weaknesses in existing 401(k) products and created a new model that did not deduct fees from employee accounts, instead charging small business owners directly.
• Marketing Strategy: He promoted 401(k) Easy through various channels, including direct mail and cold calls, educating business owners about the tax advantages of 401(k) plans.
• Technological Advancement: The company transitioned online, developing patented software that integrated individual mutual fund accounts for efficient tracking of retirement savings.
• Partnership with Union Bank: Union Bank of California collaborated with Gilbert to create a tailored version of 401(k) Easy for its clients, resulting in the 401(k) Enginuity software.
• Ownership Structure: Pension Systems Corporation, established in 2008, owns both 401(k) Easy and 401(k) Enginuity, focusing on transparency and low-cost options for small businesses.
• Self-Directed Accounts: Both 401(k) Easy and its low-cost counterpart, No Fees 401(k), provide self-directed brokerage accounts, allowing participants to choose their investments without burdening business owners.
• Commitment to Transparency: The company has maintained a strict policy of not skimming fees from retirement assets, ensuring clients are fully aware of any charges.

Background of 401(k) Easy Form Inception to Today:

401(k) Easy's design is based upon James Gilbert's knowledge and experience with retirement assets as a Merrill Lynch executive specializing in retirement plans. Mr. Gilbert's understanding of the complexities of traditional 401(k) plans led him to design a unique 401(k) model, just as 401(k) plans were gaining popularity with small businesses. Mr. Gilbert understood how traditional 401(k)s were organized and administered and what needed to be done to improve accounting, track participants' savings, expand investment options, and eliminate constant human errors. Mr. Gilbert wanted a 401(k) that concentrated on small businesses and decided that only business owners, not the company’s employees, should pay the total cost of the company's 401(k). Mr. Gilbert’s vision was that 401(k)s should give participants the freedom to select and "self-direct" an expanded lineup of qualified investment options. Most importantly, at no point would Mr. Gilbert’s 401(k) charge or skim fees or extract commissions from participants' 401(k) retirement assets.

Plan Investment offerings would concentrate on no-load mutual funds and index funds and eventually include commission-free stock and bond trading. Based on Mr. Gilbert's experience and vision, this unique business model became the foundation of 401(k) Easy's design. Ironically, it was Mr. Gilbert's solid working relationship with Charles Schwab that today offers free 40(k) accounts to 401(k) Easy, which are all self-directed and available online, insured by SIPC, and available 24/7 from a Schwab website that operates entirely independently and unconnected to 401(k) Easy's websites. If 401(k) Easy's website is offline, 401(k) participants are in no way inconvenienced, as they have direct, password-protected access to their Schwab personal self-directed 401(k) account 24/7, whether the 401(k) Easy website is online or offline.

In 2000, Mr. Gilbert was awarded a U.S. Patent 401(k) for software that used individual 401(k) accounts rather than traditional 401(k) administration “pooled” arrangements: [US Patent 6041313 awarded in 2000 for 401(K) USER SOFTWARE]. This patented 401(k) methodology departed from the traditional 401(k) plan administration model. Traditional 401(k) providers deposited all company employees' 401(k) assets in a collection of investment-themed “pools" and tracked each person's percent interest in each “pool” selected by the participant. Moving assets from one investment pool to another was complex and prone to human errors. Should a 401(k) participant leave the company and need a distribution, the 401(k)-provider had to calculate precisely to the penny what percentage of each pool the participant owned, extract that amount from the pool, and send the proceeds to the company’s plan sponsor for distribution to the participant. Pre-tax 401(k) contributions were constantly deducted from payrolls and sent by the employer to the custodian directly, for deposit in a collection of portfolio pools. The pools were managed by investment advisors, who selected the equities and bonds that should be bought and sold by the pools. The 401(k) participants had no say in the investments, and mistakes were made continually. The pools were named after different investment categories, such as "growth fund" or "international fund." Still, the number of pools was usually limited to less than 10 investment options for 401(k) participants.

The 401(k) plan provider’s costs were high, and the work was labor-intensive. Their job was to track each person's percentage interest in each pool daily so that when someone wanted to know their balance or was leaving the company, their assets would be calculated as a percentage and debited from the pool. The proceeds will be sent to the plan sponsor. This approach was expensive to maintain, difficult to administrate, and fraught with problems and errors.

Mr. Gilbert took a different approach. What is today known as 401(k) Easy was a new kind of 401(k) recordkeeper that did not deposit millions of 401(k) retirement dollars into co-mingled pools. Instead, Mr. Gilbert convinced significant mutual funds like Putnam, MFS, Transamerica, and Vanguard, and discount brokerages like Charles Schwab, E-Trade, and TD Ameritrade to open separate individually numbered accounts, one account for each new 401(k) participant, just as they were doing for their regular customers. These individual self-directed accounts would be custodied properly, giving 401(k) participants an extensive selection of qualified 401(k) investment options, including no-load mutual funds, index funds, and commission-free stock and bond trading.

401(k) Easy clients were free to choose their custodians and investments.  participants could view the value of their accounts, observe their tax-advantage funds being deposited into their accounts, and change their investment choices online. Charles Schwab offers participants free self-directed 401(k) Easy brokerage accounts, providing daily asset views and access to over 4,000 investments, including no-load funds, index funds, and free stock and bond trading.  If the participant leaves the company, their funds can be promptly and seamlessly transferred into an IRA rollover.   Easy has collaborated with Schwab for over 30 years, and Schwab is currently the default option for new 401(k) Easy plans.  The 401k User Patent made traditional pool 401(k plans nearly obsolete. Today, custodians like Schwab manage most 401(k) assets, insured by the SIPC.

 401(k) Easy guarantees participants will never pay fees from their retirement savings.   Easy has never touched a single penny or taken constructive receipt of anyone’s assets. Businesses using 401(k) Easy transfer assets to Schwab, which then returns them directly to the company.  401(k) Easy's job is not to physically handle or manage actual monetary retirement funds but instead to track and record every transaction to and from every Schwab account number, from start to finish years later. No person’s retirement assets are ever co-mingled with another person's retirement assets. That is the essence of the U.S. Patent 6041313 yielded a -administration application that took a year to compile, and another year to test. Union Bank of California performed testing before the application was released and put into use. The comprehensive U.S. bank-certified testing ensured participants’ financial security, instills confidence in retirement savings, and fully supports the AARP's animus towards fees. The Wall Street Journal reported on 401(k) Easy when it was launched and called the 'Quicken' for small businesses wanting to run their own 401(k) plans 'in-house,' using a 'run-it-yourself' approach to maintain control and to save money. A full-service 401(k)-provider costs at least five times more than a self-managed in-house system with professional support.  More critically, the comprehensive financial institution, in collaboration with financial advisors, makes investment decisions on behalf of employees, accruing fees and assuming control over the assets.

401(k) Easy is the sole online provider that does not deduct fees, including no AUM-based 401(k) fees, as a search engine can verify.  Many financial advisors are posing as 401(k) providers to access retirement assets.  Consider reviewing the final page of most provider websites. SEC required website disclosure by financial advisory firms collecting fees from assets].  The U.S. SEC requires these 401(k)-providers to disclose any SEC-registered financial advisor connections. Financial advisors registered with the SEC charge asset-based and other AUM fees for managing assets.  At 401(k) Easy, we do not dispense financial advice, are not an SEC-registered financial advisory firm, and are committed to transparency, ensuring that plan sponsors and participants are fully informed about where their money is going and how it is managed. This transparency provides users with the information needed to make thoughtful and informed decisions about their retirement savings.

At 401 (k) Easy, the employer is the only entity that pays the expenses for the company's 401(k); employees pay nothing to use the company’s plan.  401(k) Easy plans do not include fees, deductions, or commissions taken from participants' accounts.  Nonprofit AARP has extensively researched the devastating harm these fees have caused millions of their members. The results of AARP’s report regarding the irreversible damage of 40(k) fees including unnecessary AUM-based 401(k) fees, are shocking. According to the nonprofit AARP, the average person using a company 401(k) to save for retirement will pay out an astonishing $155,000 in unnecessary fees to the 401(k)-providers and their financial advisor-partners. In many cases, according to AARP, these skimmed fees are hidden inside other charges, and not disclosed., 401(k) Easy regards nondisclosure as a form of “401(k) fees pickpocketing.”

401(k) fees, including AUM 401(k) fees, can result in a significant, irreversible reduction of up to 40% in participants' retirement savings due to unnecessary deductions and charges. 401(k) fee skimming never happens to users of 401(k) Easy, but skimming is happening to 99.999% of all Americans participating in 401(k) plans today. Today, these losses are referred to as "401(k) junk fees and AUM fees".  Thousands of people have filed national class action lawsuits demanding the return of fees skimmed from their retirement assets over the years. The U.S. Supreme Court has unanimously approved the continuation of these class action lawsuits. U.S. Supreme Court rulings allowing class action lawsuits against fees].

401(k) Easy participants’ accounts are self-directed and domiciled within a qualified custodian. For example, Schwab’s website offers access to over 4,000 investment options and allows participants to review, monitor, and change their choices anytime.  This control, flexibility, and transparency empowers participants to make informed decisions about their retirement savings. 401(k) Easy web does not control the 401(k) assets custodian web. If 401(k) Easy web goes offline, the custodian web remains online and functional. 401(k) Easy plan participants still enjoy uninterrupted access and control over their self-direct accounts and monitoring of their retirement assets from the Schwab website.

401(k) Easy does not offer investment advice or manage participant accounts.  If a participant wants or needs a financial advisor’s advice, they can hire any adviser. The cost of the advisor is borne by the participants and is not paid by either the employer, 401(k) Easy, or deducted from assets.  Financial advisors are specifically barred from connecting to a participant's self-directed Schwab account and deducting fees or commissions when the plan uses  401(k) Easy.

The employer is not charged for the financial advisor, and the User Agreement bars financial advisors from connecting or skimming fees from  401(k) Easy bars the financial advisor from linking to or deducting or skimming fees from a participant's account. If an applicant wants investment advice, they must pay for it directly with after-tax dollars. 401(k) Easy guarantees no fees, commissions, or charges will ever be skimmed from any 401(k) or AUM assets t any time, or for any reasons.  401(k) Easy’s features, such as the ability for participants to inspect and change their investments 24/7 and guarantee no fees or commissions, set us apart from other 401(k)-providers and ensures a transparent and cost-effective retirement savings solution.

DETAILS:

We have been in the 401(k) business since its inception over thirty years ago. The founder of the company, Mr. James Gilbert, was previously an account executive with both Merrill Lynch and Dean Witter, specializing in IRA retirement accounts. When the 401(k) was introduced to Merrill Lynch stockbrokers in the early eighties as a new financial product, Mr. Gilbert was mesmerized by its potential and quickly decided to devote himself to it.

Mr. Gilbert, having identified the weaknesses and prohibitive costs of the 401 (k) products at Merrill Lynch and Dean Witter, saw a significant opportunity. He envisioned a new type of 401(k) that would be cost-effective, use IRS pre-approved prototype 401(k) plan documents, offer unlimited mutual fund investment options, and, crucially, not deduct or skim fees from 401(k) assets. This unique 401(k) would derive all its revenues by directly invoicing the small business owner and never deducting employee fees.

Mr. Gilbert named his 401(k) service "401(k) Easy" and was granted a trademark by the US Patent and Trademark Office. He began promoting 401(k) Easy through advertisements targeting small business owners, used direct mail campaigns, and thousands of "cold calls." He spent countless hours explaining the tax advantages of the 401(k) to small business owners. Today, every business owner knows about the tax advantages of 401(k) plans, but in the early eighties, very few people knew or understood their significance.

401(k) Easy proliferated, and when websites and search engines became the primary way to promote services to small business owners, 401(k) Easy went entirely "online." Mr. Gilbert invented a unique type of 401(k) that used individual mutual fund accounts integrated with specialized software designed to track participants' retirement savings from start to finish. For his unique 401(k) business process invention, Mr. Gilbert was granted US patent number 6041313 (Please see patent details below).

Due to 401(k) Easy's reputation and success, Union Bank of California contacted Mr. Gilbert, negotiated the use of his patent, and hired him to build a version of 401(k) Easy for Union Bank's small business clients. The 401(k) Enginuity software took over a year to write, build and test. It required the full-time efforts of ten software engineers who worked closely with Union Bank employees to make the perfect 401(k) recordkeeping product for Union Bank (please see details and press release below). Today, 401(k) Easy continues to rely on 401(k) Enginuity as the backbone of its online services.

Pension Systems Corporation owns 401(k) Easy and 401(k) Enginuity, a California corporation established in 2008. Along with 401(k) Easy and 401(k) Enginuity, Penson Systems Corporation owns several other 401(k)-related online websites and services, including a new ultra-low-cost 401(k) called No Fees 401(k). This relatively new Pension Systems Corporation lineup is essentially 401(k) Easy's "little brother." No Fees 401(k) is the perfect low-cost "starter" for a small business. What makes both 401(k) Easy and No Fees 401(k) alike is their unwavering commitment to transparency, guaranteeing never to deduct or skim fully disclosed or hidden fees from 401(k) participants' accounts. Also, 401(k) Easy and No Fees 401(k) provides employee participants with unlimited investment options by offering self-directed brokerage accounts from top companies like Charles Schwab. With self-directed brokerage accounts, participants can select investments that fit their goals, needs, and experience. In addition, self-directed brokerage accounts free the small business owner from the responsibilities and liabilities of choosing investments for the company's 401(k).

About the Founder & CEO of Pension Systems Corporation

Mr. James Gilbert, founder, and CEO of Pension Systems Corporation (PSC), launched low-priced, complete 401(k) plans in 2008. His company is based upon a US Patent he was awarded in 2000 (401(k) User Software, Patent 6041313). PSC is a California corporation (CA 3121569) and has maintained an A+ rating with the US Better Business Bureau for 25 years. James' education, work experience, and professional background have made him an expert in affordable 401(k) plans that quickly adapt to the evolving needs of small business owners like himself.

Mr. Gilbert graduated from the University of California, Berkeley, in the late '70s. His first significant corporate job was as general sales manager of KFOG Radio in San Francisco, California. At the time, KFOG was owned by General Electric. As a GE manager, James attended exclusive seminars taught by GE CEO Jack Welsch, America's most famous and influential corporate leader.

While as a manager of General Electric's KFOG Radio (and with GE's full knowledge and approval), Mr. Gilbert started Radio Ad Monitor (RAM), a radio advertising research company. RAM was based upon another of Mr. Gilbert's inventions: software that automatically identified, recorded, and tabulated all radio commercials broadcast from radio stations operating in the San Francisco Bay Area. RAM successfully expanded to include the San Jose and Sacramento radio markets. From James' exposure to San Jose's "Silicon Valley," he met engineers and computer programmers who, in later years, helped Mr. Gilbert secure the US Patent referred to above.

General Electric sold KFOG Radio, and Mr. Gilbert joined Merrill Lynch, the country's largest stock brokerage business. James was hired as an executive specializing in retirement plans. His client base increased quickly because of his prior business relationship with Bay Area radio executives. In those days, most people, including very well-paid people, did not know about the tax benefits of IRA accounts. Mr. Gilbert stepped in, educated clients, and opened hundreds of IRA accounts at Merrill.

While at Merrill, Mr. Gilbert learned about a new kind of retirement plan called the "401(k)". For him, 401(k) was "love at first sight" and motivated him to leave Merrill, take his clients, and start his own 401(k) business. To accomplish this, Mr. Gilbert set up an independent NASD-registered Broker/ Dealer named Pension Service Associates Securities (CRD 29919) to manage his clients' IRAs while simultaneously setting up and launching his unique 401(k), designed and priced especially for small businesses.

It is critical to appreciate that, unlike most other NASD/FINRA Broker/Dealers and FINRA Registered Investment Advisors, James disliked the industry trend of "skimming" fees from clients' retirement assets. In addition, James recommended only commission-free, no-load mutual funds to his clients. His only compensation for these services was getting referrals for his new 401(k) services. For the past 25 years, James has used Charles Schwab discount brokerage as the primary custodian for his clients' IRAs and 401(k)s. He has an ironclad guarantee that his 401(k) plans never skim fees or commissions from retirement assets.

To this day, Pension Systems Corporation's 401(k) Easy and No Fees 401(k) has never taken a single penny in fees or commissions from clients' retirement assets. It is clear from this website that James explicitly rejects the notion that registered investment advisors and brokers/dealers should charge pocket fees and commissions from retirement plan assets, including IRAs and 401(k)s. After fifteen years in operation, Mr. Gilbert sold his NASD/FINRA Broker/Dealer and transitioned to a FINRA Registered Investment Advisor (CRD 158650). He remains vehemently opposed to asset-based fee skimming by financial advisors and their brokerages. AARP agrees and publishes a detailed study about the significant harm asset fee skimming does to a person's 401(k) retirement savings. You can download this AARP 401(k) Fee Report from this website.

We hold the United States-issued Patent 6041313 for our highly regarded self-service 401(k) technology.

For over a decade before developing our revolutionary self-service 401(k) system, we operated as a valued full-service provider of 401(k), 403b, and other government-sanctioned retirement plans. Back then, we specialized in plans for small and mid-sized businesses. We provided small businesses with affordable plans rich in investment options and flexibility long before other 401(k) providers showed interest in the small plan market.

Back then, as now, we found that by diverging from the "big plan" administrative setup used by most of the 401(k) industry, we could cut administrative overhead and save clients money by rethinking the particularly inefficient areas.

The Wall Street Journal describes 401(k) Easy as the "Quicken" of 401(k) plans for small businesses.

The Wall Street Journal said the following about our self-service 401(k) software back when we introduced it in 1999:

"(It) allows small businesses to manage 401(k) plans as easily as consumers navigate family finances with programs such as Quicken" ("Web Helps Small Firms Start 401(k)s," 12/27/99, C1).

Our 401(k) software (401(k) Enginuity at www.401kenginuity.com) developed in conjunction with Union Bank of California (UBOC) and customized 401(k) plan proved so innovative in the 401(k) industry that it is patented.

The Wall Street Journal article describing 401(k) Easy and the joint 401(k) Easy / Union Bank press release.

(Summary) In conjunction with Union Bank of California, Pension Systems Corporation developed 401(k) Easy Online, a web-based 401(k) plan administration service based upon the success of the 'run-it-yourself' pc-based 401(k) Easy.

Web Helps Small Firms Start 401(k)s

YOUR MONEY MATTERS
By JEFF D. OPDYKE
Staff Reporter of THE WALL STREET JOURNAL

Tom Hendricks's employer recently adopted a 401(k)-retirement plan for him and his colleagues. Big deal, you say? Well, it is. Mr. Hendricks and the thirteen managers who oversee trust-fund operations for a California union have never had access to the hugely popular retirement accounts because of the expense and complexity of running them.

Now, though, cheap, and efficient technology is changing those notions. Easy-to-use software and low-cost back-office support - much of it available online - are opening retirement-savings benefits to an estimated twenty-seven million small-business workers who do not have retirement plans. It is also allowing companies with inflexible and meager plans to upgrade to more appealing, full-blown 401(k) by pushing down administrative costs and challenging the idea that small-business owners cannot manage the rule-bound accounts. "There's been a lot of mumbo jumbo used in this industry to create a Tower of Babel that running a 401(k) is tough," says Jim Gilbert, who has spent 15 years designing and overseeing retirement plans. Mr. Gilbert, president of 401(k) Pro Inc., Los Angeles, recently introduced a software program called 401(k) Easy - which allows small businesses to manage 401(k) plans as quickly as a consumer navigates family finances with programs such as Quicken. "This is not brain surgery," he says.

Reprinted from THE WALL STREET JOURNAL.

FOR IMMEDIATE RELEASE

James Gilbert
President, Pension Systems Corporation
(800) 660-0050
http://www.401k-network.com

CONTACT: Sharon Woodson-Bryant, Union Bank of California

Union Bank of California, N.A., Pension Systems Corporation, Launch Web-based 401(k) Administration Service for Small Businesses

LOS ANGELES Union Bank of California (UBOC), N.A., and Pension Systems Corporation have jointly developed a web-based 401(k) plan administration service based upon their existing desktop product. The service allows clients to set up and manage low-cost, option-rich "run-it-yourself" 401(k) plans from any location connected to the Internet — be it via computer terminal, web-enabled mobile phone, or PDA device; access via a toll-free automated voice response system is also available. Like the desktop product, the system is geared toward serving small businesses of one to one hundred employees.