Empower Launches Fee-Free Index Fund

Empower Financial Services Inc. has launched a zero-fee index fund for retirement investors seeking to save through workplace retirement plans, the retirement plan and wealth services provider announced on Wednesday.

The new fund, the “Empower S&P 500 Index Separate Account” offers retirement investors broad market exposure free of management fees—the first such offering in the industry, according to Empower.

The absence of fees is intended to allow retirement plan participants higher growth potential for their retirement savings.

“We are driven to help make investing more accessible and affordable,” said Rich Linton, Empower’s president and chief operating officer. “With this zero-fee index fund, we believe we are optimizing the value that plan participants can receive for their invested dollars.”

The new fund will be available to all investors saving for retirement through defined contribution plans, such as 401(k), 401(a) and 457(b) plans, according to the release. Investors in other employer-sponsored plans, such as pensions and other qualified retirement accounts, will also have access to the fund.

“Our aim is to give investors the best chance to maximize their returns on their investments,” said Jonathan Kreider, Empower’s executive vice president and head of investments. “This fund puts every dollar to work for investors, helping them keep more of what they earn.”

The fund aims to track the total return of common stocks in the S&P 500 Index. BlackRock Inc. will serve as sub-adviser of the fund.

The latest offering builds on the company’s institutional separate account platform, which includes more than 100 strategies with more than $80 billion in assets under management. Like a collective investment trust, institutional separate accounts pool assets from more than one retirement plan to achieve economies of scale and pricing.

Empower administers more than $1.8 trillion in assets for 19 million investors, as of December 31, 2024.