DBIllustration o65-55-60


Owner Age(s): 65
Employee Ages: 55, 60
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) $280,603 $203,639 $203,639
Owners' % of plan cost 73.8% 69.4% see Owners' % of
Grand Total below
401(k) Plan
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) $314,603 $237,639 $224,139
Owners' % of Grand Total 74.7% 71.1% 75.6%
Administrative expense: high twice as high three times as high
Overall Grade*: D F F
Comments: Employee cost prohibitive.

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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.