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Executive Compensation Plans

As small business owners and professional organizations continue to expand, attracting and retaining executive and management talent becomes increasingly crucial. This competition for talent has led to the evolution of the executive compensation market. These plans and strategies are often essential components of the overall benefits package and require integration with existing ERISA-governed plans such as 401(k) and profit-sharing plans.

Types of Plans

Includes 457 plans for governmental employees, 409A for private-sector top management, and other non-qualified deferred compensation arrangements.

Benefits for Employees

  • Tax deferral on contributions and earnings until withdrawal.

  • Potential for higher earnings accumulation due to deferred taxes.
  • Customizable withdrawal options to match retirement or long-term financial goals.

Benefits for Employers

  • Recruit, Retain, Reward and Retire: We help you develop the tools needed for attracting and retaining key executives and high-earning employees.
  • No immediate tax requirement for contributions, helping cash flow and financial planning.
  • Flexibility in plan design not typically subject to ERISA requirements.

Benefits for Policyholders

  • Cash value accumulates on a tax-deferred basis.
  • Policyholders can borrow against the cash value or make withdrawals, subject to the policy’s terms.
  • This can serve as a tax-efficient vehicle for estate planning and wealth transfer.

Use in Retirement Planning

  • It can supplement retirement income through loans or withdrawals and is typically tax-free if managed properly.
  • Provides a death benefit that can support family or heirs even as the cash value is accessed during the policyholder’s lifetime.
  • It serves as a strategic financial tool offering a stable investment option with predictable growth, unlike more volatile market investments.
  • It’s useful in business for key person insurance or buy-sell agreements, funding a deceased partner’s share buyout.

If you would like to learn more about our services, we invite you to contact us to schedule a get-acquainted conversation.

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