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Session 13 Plan Selection

CERTIFIED FINANCIAL PLANNER CERTIFICATION PROFESSIONAL EDUCATION PROGRAM Retirement Planning & Employee Benefits. Session 13 Plan Selection. Session Details. Plan Selection Qualified & Nonqualified Plans. Retirement Plan Selection Process: Business Environment.

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Session 13 Plan Selection

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  1. CERTIFIED FINANCIAL PLANNER CERTIFICATION PROFESSIONAL EDUCATION PROGRAMRetirement Planning & Employee Benefits Session 13Plan Selection

  2. Session Details

  3. Plan Selection Qualified & Nonqualified Plans

  4. Retirement Plan Selection Process: Business Environment Determine how best to meet owner’s retirement savings through a qualified plan (Personal Objectives, Business Objectives, Altruistic Objectives) Owner will commit to a retirement plan and owner has a savings need? Yes No Stable cash flow and owner will make annual commitment? Select discretionary plan. Is owner’s savings need <=25% of compensation? Reassess retirement objectives/alternate savings No No Reassess Yes Yes Is owner’s savings need >25% of compensation? Profit sharing plan (age-weighted if over 45) Select profit sharing or P/S 401(k) SEP, profit sharing, stock bonus or ESOP plan. Share ownership? No No Yes Yes Reassess Select stock bonus or ESOP No Is owner oldest and owner’s age >=45? Yes DB plan

  5. Qualified Plan Characteristics (1)

  6. Qualified Plan Characteristics (2)

  7. Qualified Plan Characteristics (3)

  8. Other Qualified Plan Characteristics

  9. IRA Hybrid Retirement Benefits

  10. Points to Consider in Selection of Most Appropriate Plan

  11. Points to Consider in Selection of Most Appropriate Plan

  12. Practice Problem 1 Match the following characteristics with the item that matches it best (one match each).

  13. Practice Problem 2 Indicate which type of employee is used for each test.

  14. Practice Problem 3 What is the maximum vesting schedule allowed for each of the types of plans indicated? Defined benefit_________________________ Cash balance__________________________ Defined contribution_____________________

  15. Want More Review? Visit eCampus • Click Programs or Individual Courses Tab • Click Online Classes Tab • Click MyChoice Recordings to expand • Click Recordings link for your course Final recordings contain reviews.

  16. CERTIFIED FINANCIAL PLANNER CERTIFICATION PROFESSIONAL EDUCATION PROGRAMRetirement Planning & Employee Benefits Session 13End of Slides

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