Corporate Benefit Consulting
The company is focused on growth and needs a firm to provide “hands-on, relationship-focused service” for their executive benefit plans to properly incentivize and retain their top people.
Consequently, the company establishes a Nonqualified SERP (Supplemental Executive Retirement Plan) for the most senior executives in the firm to make up for lost benefits due to freezing the company pension plan.
- Lack of institutionalized administrator processes to assure proper funded status
- Taxation on the earnings of assets in the Rabbi Trust
- No process for implementation and compliance
The Suggested Solution
In situations like this, Legacy would provide the company with an institutionalized administrative process to put in place as personnel changes occurred within human resources.
We would also suggest quarterly updates for tracking assets to liabilities.
Lastly, we would recommend monitoring the return comparison for each fund AND comparing the cost of insurance in the TOLI strategy to the corresponding tax liability if the funds were exposed to income taxes.
It would be our hope that by implementing these measures, the company would experience growth both in employee head count and value of the company.
Disclosure: All case studies have been written for illustrative purposes and should not be construed as a testimonial or specific client experience. They are hypothetical situations that discuss the complexities of a situation, event, or a problem that one could encounter in the work area.