Plan Design

Sidecar Accounts

Sidecar Accounts

Before the retirement community shifted to a pretax 401(k) system in the 1980s, many companies offered a supplemental savings account (to be used for short-term emergencies) to complement the defined benefit (DB) plans of their employees. These supplemental savings...

read more

Hardship Withdrawals from 401(k) and 403(b) Plans

On February 23, 2017, the Internal Revenue Service released its Substantiation Guidelines for Safe-Harbor Distributions from Section 401(k) Plans. And on March 7, 2017 they released a similar memorandum regarding section 403(b) plans. These two statements outlined the...

read more

The Cadillac Tax

Health insurance has always been a hot topic of conversation both in the political and financial worlds, and it’s easy to see why, especially in recent years. Health care costs continue to skyrocket, not just for individuals, but also for employer-sponsored health...

read more

Is PBGC Coverage Required for Your Plan?

The Pension Benefit Guaranty Corporation was established on September 2, 1974 under President Gerald R. Ford with the signing of ERISA (the Employee Retirement Income Security Act). According to Ford, “Under this law, the men and women of our labor force will have...

read more

Better Solutions for Today’s Retirement

With the introduction of 401(k) plans in 1980, the responsibility for retirement contributions shifted from the employer to the employee. Unfortunately, the employee had no way of gauging what those contributions should be, or how the contributions should be invested....

read more

Employees & Short-Term Value

In today’s world of instant gratification, it’s no wonder that workers value short-term benefits the most. According to a worldwide study of more than 10,000 workers conducted by Mercer, a salary increase was preferred over all types of benefits. While...

read more

Corrective Distributions

Compliance Tests for 401(k) Plan Employee Deferrals The 401(k) plan has emerged as the most popular form of retirement plan in the United States. This trend will likely continue for some time for a number of reasons. One is the cost savings to employers, since...

read more

Cash Balance Plans for Larger Tax-Deferred Contributions

Cash Balance Plan: What is it? How does it work? There are two main types of qualified retirement plans: defined contribution (DC) and defined benefit (DB). The maximum annual contribution to a DC plan is $54,000, while the contributions to a DB plan could be in...

read more

Profit Sharing Plans: Better Ways to Use Them and Why

A Profit Sharing Plan is another special type of defined contribution (DC) plan under which employers, rather than employees, are the ones making contributions. After the company makes its annual contribution, the total contributions are then allocated to individual...

read more