DBIllustration o35-20-20-20-25-25-30-30-35-35-40
© 2004
AutomatedPensions.com
DBIllustrationBank
Owner Age(s):
35
Employee Ages:
20, 20, 20, 25, 25, 30, 30, 35, 35, 40
Year:
2007
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3 Plan Comparison
Traditional
Defined Benefit Plan
Cash Balance Plan
Cross-Tested
Cash Balance Plan +
Profit Sharing Plan
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illustration
illustration
illustration
Defined Benefit Plan
Cost of owner(s)
$47,036
$56,995
$56,995
Owners' % of plan cost
53.6%
62.9%
see Owners' % of
Grand Total below
401(k) Plan
(includes
Profit Sharing)
optional/required
optional
optional
required
Additional benefit
to owner(s)
(includes owners'
401(k) deferral)
$29,000
$29,000
$45,000
Combined Plans
Total for owner(s)
$76,036
$85,995
$101,995
Owners' % of Grand Total
58.5%
63.0%
80.2%
Administrative expense:
high
twice as high
three times as high
Overall Grade
*
:
C
C+
B
Comments:
Owner may be better served to wait to start Defined Benefit Plan until just 10 years from retirement.
Owner may be better served to wait to start Defined Benefit Plan until just 10 years from retirement.
Owner may be better served to wait to start Defined Benefit Plan until just 10 years from retirement.
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*Note that even poorly graded plans may be appropriate in certain situations, such as for lower benefit levels, or if the employee total compensation package is negotiable.
