Defined Benefit Plans
A defined benefit plan can allow business owners to reduce taxable income by $100,000 to $200,000 or more per year, significantly more than a 401(k) alone, while building substantial tax-deferred retirement wealth.
What Is a Defined Benefit Plan?
A defined benefit (DB) plan is a type of retirement plan that promises a specific monthly benefit at retirement, calculated based on salary and years of service. Unlike a 401(k), the contribution limits are based on the desired benefit, which means much higher annual contributions are possible, especially for older business owners with high incomes.
Two Strategic Benefits
First, DB plans offer the highest tax-deductible contribution limits of any retirement plan, often exceeding $200,000 per year. Second, they can be combined with a 401(k) for even greater tax savings. For profitable business owners over 40, this combination can be one of the most powerful tax reduction strategies available.
Is a DB Plan Right for Your Business?
DB plans work best for business owners with consistent high income, few employees, and a desire to accelerate retirement savings. We help you model the numbers, design the plan, and manage the ongoing administration. Find out if a DB plan fits your situation.
A Quiet Invitation
For the right business owner, a defined benefit or cash balance plan can shelter a substantial amount from taxes each year. Let us run the numbers on what a custom-designed plan could do for you. We do not believe in pressure or hard pitches. We believe in the right relationship with the right people at the right time.
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