Cash Balance Plans for Businesses with Employees
Case Study
Meet Joe & Carl
Meet Joe and Carl, long-time partners in their biotech consulting firm located in San Diego, CA. They have four support staff employees all of whom are valued long-time team members. As successful small business owners, they want to maximize their annual savings for both tax and retirement purposes.
The Motivation
After a plan design analysis held through our team at Premier Plan Consultants, it was discovered that Joe and Carl could each defer a large portion of their compensation annually into their retirement accounts.
The business generates enough income that Joe and Carl can comfortably save as much as possible personally. Additionally, they are happy to provide generous benefits to their staff to ensure they keep the best talent on their team.
How it Works
The Impact
With the help of the Cash Balance plan, Joe and Carl were able to save a significant amount of money towards their retirement goals.
This plan elevated their firm’s retirement offerings, enabling higher contribution limits than standard 401(k) plans, thus fostering a more robust financial future for both the owners and their team.
The plan’s design was particularly advantageous, allowing the firm to allocate retirement funds in a way that directly correlated with each employee’s career achievements and tenure. This thoughtful approach not only incentivized employee retention and satisfaction but also allowed Joe and Carl to derive significant tax benefits, reinforcing the firm’s financial stability.
By choosing the Cash Balance Plan, the partners affirmed their commitment to their staff’s welfare and their own retirement readiness.
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