(FORTUNE Magazine) – Don't be surprised if your favorite mutual fund company soon pops up in an interoffice memo. Fund companies are going after your retirement dollars as never before. Says Lawrence J. Lasser, president of Boston's Putnam Investments, which manages $5 billion of 401(k) assets for 130 corporations: "The 401(k) business may be more profitable than retail mutual funds in the next five years. We are counting on this to be a big part of our future."

Of course, mutual funds have had a piece of the 401(k) pie since the mid-1980s. But more corporations are now outsourcing those plans to firms that can manage investment options, education programs, and complex electronic record keeping. Big mutual funds are doing well because they already have such services in place for their retail investors (see chart).

That means that even though administering a plan is time-consuming and expensive, fund companies can make a healthy profit. They also buy into a predictable, growing business. According to Access Research, a consulting firm in Connecticut, 17.5 million U.S. workers participate in such plans, a number they expect will grow 5% in each of the next five years as more workers become eligible.

Managing a company plan also gives a fund instant access to hundreds, if not thousands, of new investors. Says Robert Reynolds, head of Fidelity Investments' 401(k) business, the leading mutual fund in the field: "The retirement business is great because the money is earmarked for long-term investments. As the retail markets go through cycles, retirement money is a wonderful anchor in the storm." In 1990, 401(k)s accounted for about 8% of Fidelity's total assets under management; now that's up to 25%.

Losing out in this battle are traditional pension managers, like less nimble banks and insurance companies, and your local neighborhood investment adviser, who doesn't have the resources to compete with the big guys. But for some of the hazards of parking your money in the funds these guys manage, see Investing.

- Susan Caminiti