Additional Plan Options
Because businesses have unique situations that require special retirement plans, we offer:
Deferred Compensation Plans:
To attract and retain key executives, board members, or selected highly compensated employees, you can supplement the benefits of your qualified retirement plan with deferred compensation plans for these individuals.
These plans have become more important in retirement planning because of:
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the complexity of, and frequent changes in, the laws regarding qualified plans and the limitations on contributions to those plans. By allowing these key people--and prospective key people--to contribute more, your becomes more rewarding and attractive to them.
For those companies that find their retirement program insufficient to provide appropriate retirement benefits to key employees, a deferred compensation plan can be the answer. It will allow for the application of this key benefit to only certain select employees.
Cross-tested and age-weighted qualified plans:
With few exceptions, young employees are able to contribute less to retirement plans, and older employers can--and want to--contribute more. A possible problem in allowing this, however, is that your plan can appear to discriminate against younger employees.
Cross-tested and age-weighted plans overcome this hurdle, however, and reflect a basic principle: the time value of money--or, as Einstein once referred to it, “the miracle of compound interest.” Younger employee may contribute less than older ones, but because interest compounds each year, the money people invest at earlier ages is worth more than the same amount invested later.
We can help you determine if these specialized plans may be ideal for you.
Safe Harbor 401(k) Plans:
The Average Deferral Percentage (ADP) test sets limits contributions to qualified retirement plans, and can make them less attractive to key, highly-compensated employees. You may be able to avoid these limits by qualifying for a Safe Harbor 401(k) plan, if your plan has:
- a required contribution standard,
- a specific vesting schedule,
- specific account withdrawal restrictions,
- and a designated annual notice requirement.
We can help you in assessing the value of this plan, and qualifying for it.
