DBIllustration o55-65

DBIllustrationBank

Owner Age(s): 55
Employee Ages: 65
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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Defined Benefit Plan Cost of owner(s) $252,657 $153,926 $153,926
Owners' % of plan cost 85.8% 80.1% 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)
$34,000 $34,000 $20,500
Combined Plans Total for owner(s) $286,657 $187,926 $174,426
Owners' % of Grand Total 86.3% 81.6% 84.0%
Administrative expense: high twice as high three times as high
Overall Grade*: B+ F F
Comments:


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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.