Cash Balance Plans
Cash balance plans are a type of retirement plan designed for business owners and closely held businesses. They are commonly used by high-income and high-profit businesses and are often paired with other retirement plans to increase overall savings opportunities. These plans can serve as a powerful tool for both business planning and long-term wealth accumulation.
Who These Plans Are Typically Suited For
Cash balance plans are often a good fit for business owners with consistently strong profits, high-income professionals such as attorneys, physicians and private medical practices, dentists, orthodontists, and dermatologists, and skilled trades and contracting businesses including construction, landscaping, and plumbing. They can also be structured to benefit businesses with employees, where the plan supports both owners and staff.
Benefits and Planning Considerations
Cash balance plans can support long-term wealth accumulation for business owners and play a role in managing taxable business income. They can be structured to align with the business owner's goals and workforce and may serve as either a standalone retirement plan or part of a combined strategy alongside a 401(k) plan. Combining plans may increase flexibility and allow for more nuanced planning based on the business's specific circumstances.
How We Support Clients
Our role includes helping clients evaluate whether a cash balance plan is appropriate, coordinating with accountants, third-party administrators, and other professionals involved in the plan, and assisting with plan design so it aligns with the client's objectives. We also support the investment structure for both owners and employees and provide ongoing coordination to help keep the plan running smoothly year to year. Our goal is to help clients stay organized so they can remain focused on running their business.
Ongoing Coordination and Management
We assist with annual planning conversations, help ensure documentation and processes stay on track, and support investment oversight as part of the broader advisory relationship. We act as a consistent point of contact as the business and plan evolve, providing continuity and clarity over time.
