Plans that We Support

Below is a list of plans we support including their descriptions and benefits.

A 401(k) plan is a defined contribution (DC) plan, typically a profit sharing plan that contains a cash or deferred arrangement as described in section 401(k) of the Internal Revenue Code. A cash or deferred arrangement is simply one that allows plan participants to elect to defer a portion of compensation, their elective deferrals, and have it contributed to the plan on their behalf, typically through payroll withholding.

The employer may contribute to the plan by matching all, or a portion, of the elective deferrals or by making non-elective, or profit sharing, contributions to all eligible participants.

401(k) Plans are Ideal for:

  • Employers who are initiating a plan due to employee demand
  • Employers wishing to maximize contributions
  • Employers wishing for discretionary contributions

The one-participant 401(k) plan isn't a new type of 401(k) plan. It's a traditional 401(k) plan covering a business owner with no employees, or that person and his or her spouse. These plans have the same rules and requirements as any other 401(k) plan.

Solo K plans are ideal for:

  • A business owner with no common-law employees
  • A business owner who wishes to cover his or her spouse
  • A business owner who wishes to make higher contributions than allowed in a SEP or SIMPLE IRA

A Defined Benefit Plan (DB) is considered a traditional pension plan because it guarantees a monthly pension benefit for the life of the participant. A DB plan does not maintain account balances to reflect the accrued benefit of each participant, but must define a benefit formula and how the benefits are accrued under that formula. This type of plan favors older employees with longer terms of service.

Defined Benefit Plans are Ideal for:

  • Employers who are older and have more service than other employees
  • Employers wishing to maximize contributions
  • Employers with substantial resources
  • Employers wishing to replace a certain percentage (e.g., 70 percent) of pre-retirement income
  • Employers with stable income

A Profit Sharing Plan is a Defined Contribution Plan that provides employees with contributions made by their employer. In its basic form, this type of plan is the easiest to administer. The employer has discretion to determine when and how much the company pays into the plan.

Profit Sharing Plans are ideal for:

  • Employers that wish to have flexible contributions
  • Companies where cash flow may be an issue
  • Companies that do not wish to make employee contributions

A Cash Balance Plan is a type of Defined Benefit Plan. By taking advantage of age and salary differences, a Cash Balance Plan tilts the contributions towards a desired employee or group of employees. Unlike a traditional Defined Benefit Plan however, a Cash Balance Plan provides a "hypothetical" account balance for the participants which accrues interest at a pre-defined government rate.

Cash Balance Plans are Ideal for:

  • Employers who are older than some of the staff employees
  • Employers desiring larger contributions for certain classes of employees
  • Employers with substantial resources
  • Employers with stable income

A Cross Tested plan is a hybrid plan that combines features of both defined benefit and defined contribution plan generally to skew the employer contributions in favor of the older, higher paid employees. These plans provide the ability to create multiple benefit levels and are flexible in their contributions.

Cross-Tested Plans are Ideal for:

  • Employers who are older than some employees
  • Employers desiring larger contributions for themselves and possibly other key employees
  • Employers desiring flexible contributions

A 403(b) plan (also called a tax-sheltered annuity or TSA plan) is a retirement plan offered by public schools and certain 501(c)(3) tax-exempt organizations. Employees save for retirement by contributing to individual accounts. Employers can also contribute to employees' accounts.

403(b) plans are ideal for:

  • Organizations who wish to offer flexibility in contributions
  • Organizations who wish to allow their employees to defer some of their salary, but may not wish to make employer contributions