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Plan Design

Wharton Hill Advisors > Plan Design

Your Plan.  Your way.

We are product and provider agnostic; open to working with whatever suitable services reflect the unique requirements of your plan. Our experienced advisors offer expert advice across plan design features, implementation and ongoing service for both qualified and non-qualified programs such as 401(k), 401(a), 457, ESOP’s, Cash Balance, and Deferred Compensation Plans.

The five key components of our plan analysis are:

  • Plan design
  • Plan financing
  • Plan administration and fee benchmarking
  • Investment advice
  • Participant education and advice

We leverage decades of experience serving as a trusted partner, helping to guide retirement plan sponsors toward informed decisions with independent advice, cost transparency, and objectivity. Through our approach of plan analysis and benchmarking, we help plan sponsors better diagnose issues, understand costs, streamline operations, and, ultimately, help ensure that their plans, both qualified and non-qualified, accomplish what is intended: to recruit, retain and reward the company’s most valuable employees as cost-effectively as possible.

Nonqualified Executive Benefit Plans

Historically, nonqualified deferred compensation plans have played an important role in the overall benefit and compensation planning for a growing, profitable company. Executives and other highly compensated individuals may be subject to significant restrictions when it comes to their employer-sponsored retirement plans. Because of various IRS and ERISA restrictions under “qualified” plans, many companies offer “nonqualified” plans to certain employees. These nonqualified plans can be tailored to a specific company’s or individual’s needs, and plan specifics can vary considerably from plan to plan.

Our comprehensive advisory services are designed to bridge the retirement gap that exists for your highly compensated employees. Nonqualified plans differ significantly from qualified plans in their contribution limits, funding structures, and distribution rules. Nonqualified plans have no legal contribution limits, and limits are often significantly higher than for qualified plans. As with qualified plans, contributions to nonqualified plans are tax deferred, but unlike qualified plans, contributions are not technically “owned” by plan participants until they are paid.

Typically, plans are funded in one of three different ways: “pay-as-you-go,” mutual funds, and life insurance. Each method seeks to satisfy IRS standards for tax-deferral status while giving some level of security to plan participants that their deferred benefits will be paid. But methods differ in their degree of risk as well as their tax reporting requirements.

Distribution options also differ according to plan structure. Some, such as those set up within the framework of a life insurance policy, may permit more flexibility. Employers may also limit choices on how and when employees receive distributions as well as how long it takes to fully vest in employer contributions. The IRS has additional tax rules governing nonqualified deferred compensation and distributions, so check with a qualified tax advisor to ensure compliance.

Read more on how non-qualified deferred compensation can offer creative benefit and compensation arrangements to attract and retain key personnel.


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