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Cash Balance Plans

re-Defined Benefit Plan

re-Defined Benefit Plan

Cash Balance Plans (CBPs) are a kind of Defined Benefit Plan that offers much more much more flexibility than a traditional pension plan.  The primary benefits of CBPs are; 1) significantly higher contribution limits than a 401(k) plan alone, 2) a tremendous tax deferral opportunity, and 3) funding flexibility.

Cash Balance Plans tend to work best with successful business owners who are in their prime income earning years with consistent income and are seeking relief from high income taxes.  Typically, business owners who are already maxing out their 401(k)'s with appetite to fund more are good initial candidates.

With the outsized benefits, Cash Balance Plans do come with outsized risks if managed improperly.  Working with an experienced professional is key to successfully executing this complex strategy.