Changing Investment options in 401k plan

[fynn6%7]

401k plan is changing from all brokerage FBO accounts to a platform with an insurance/annuity company that provides mutual funds but no stocks and bonds.. Owner has corp. bonds and would like to keep her account but make future contributions to the platform. All other participants, who have their accounts invested in cash, would have their accounts transferred to the platform - the brokerage account would no longer be an option for them.

Is there a problem with this? Perhaps discriminatory?

I appreciate your thoughts.

[QDROphile]

Are you saying that all the other participants have not invested any funds or that they have all liquidated the investments, perhaps in anticipation of the transfer?

[Bird]

In my opinion, the other participants must retain the option of having a brokerage account. I'd have each one sign some kind of election form saying, in effect "I understand that I have the ongoing option of a brokerage account and choose to use the platform at this time."

404a fee disclosure should cover both options.

I'm not saying it's the best way to do things but it is do-able.

[fynn6%7]

All non-owner participants have their accounts invested in cash, not liquidated in anticipation of the transfer.

The option to have participants sign an election to use the platform sounds like a do-able option. Not perfect, but certainly do-able.

Thanks for your responses.

[WCC]

Will a TPA be involved or is it going bundled? If it is going bundled, the new recordkeeper may have issues with reporting if they don't have all the assets. Just something to be aware of.