Five major mutual fund groups have signed up to offer some of their funds to 401(k) plan participants through GoldK, the one-year-old Internet 401(k) plan service company of Waltham, Mass.

American Century of Kansas City, Mo., Federated Investors of Pittsburgh, Fidelity Investments of Boston, Franklin Templeton of San Mateo, Calif. and Janus Capital of Denver have signed up with GoldK, according to GoldK. Several more mutual fund companies are expected to sign up within the next few weeks, said Troy Shaver, vice chairman of GoldK since April. Shaver was previously president and CEO of State Street Investment Research of Boston.

GoldK's goal is to bring the entire operation of a 401(k) plan and its participants' accounts online, said Shaver.

"We've tried to reinvent the 401(k) industry," he said.

GoldK wants to entice predominantly small companies to set up 401(k) plans for employees at its website by offering them free 401(k) plan administration and record-keeping services. High 401(k) plan administrative costs often make it prohibitively expensive for smaller companies to establish defined contribution plans, said GoldK executives. Those companies that do, nevertheless, offer plans, are faced with deciding whether to pay the costs or pass some onto employees.

GoldK will offer the services on the condition that plan sponsors agree to open and manage their 401(k) plans at GoldK's website.

GoldK's 401(k) plan website provides mechanisms to help participants manage their plan accounts including asset allocation models, calculators and educational materials.

Individual fund prospectuses and video clips of portfolio managers are also available to plan participants as well as Morningstar fund reports. GoldK's 401(k) plan services also include PIN number protected current account lookup, and a live customer service representative available by a special e-mail connection that has no delays. The rep can help plan employees or human resources personnel find whatever information they may be seeking or can answer questions about a particular plan.

GoldK's service representatives are able to interact with four or five participants at the same time, and see exactly what screens each visitor is looking at. GoldK reps can also track which screens each visitor has looked at during his entire visit, said Shaver.

If visitors want to talk with representatives by phone, they can e-mail their phone numbers to the representatives.

The technology allows for three people - say an outside accountant or a participant's investment advisor - to view the same website and participate in discussions of the client's case through the special e-mail system.

The costs of providing the services are covered by the fund companies which have signed distribution agreements, said Shaver.

GoldK has revenue-sharing arrangements with fund sponsors, said Shaver. Under the arrangement, GoldK is periodically paid a percentage of the 401(k) plan assets the firm brings to each mutual fund group, he said.

GoldK will not market its 401(k) plan program directly to plan sponsors, but

rather through intermediaries including broker/dealers, banks, insurance companies

and financial planners, as well as third party administrators, said Shaver.

GoldK, which operates only online, expects to obtain most of its new business through other Internet businesses with which it hopes to establish partnerships, Shaver said.

GoldK has so far signed contracts to administer a dozen 401(k) plans and is negotiating with another dozen companies, said Shaver. Many of these clients are technology firms whose employees are comfortable navigating the Internet. Shaver declined to disclose current assets under administration in those plans.

GoldK also has a solution for tech-shy companies that may not equip every employee with a PC or offer Internet access. For a lease fee of $40 per month, GoldK will equip a sponsor with a dedicated PC and printer.

GoldK plans to expand its account capability from its current limit of 10,000 participants per plan up to one million participants by next year.

GoldK has built into its current systems the ability to provide servicing for IRA rollovers as well.

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