What is a BrightScope RatingTM?
The BrightScope RatingTM is a quantitative 401k plan rating developed by BrightScope with the help of leading independent fiduciaries, finance professors and 401k experts. The BrightScope rating algorithm takes in 200+ unique data inputs per plan and calculates a single numerical score for every 401k plan in the country. The algorithm runs thousands of simulations for each plan in order to determine how quickly each 401k plan will get the average 401k participant to retirement. BrightScope believes that this rigorous approach is necessary to ensure that every factor that affects retirement outcomes – company contributions, fees, investment menu quality, vesting schedules, eligibility periods etc. – is accurately reflected in a company’s rating. The BrightScope RatingTM is designed to assist industry participants in determining the relative quality of a company’s 401k plan when compared to a unique peer group of companies with employees of a similar demographic makeup. We believe that i
