You may already have a standard benefits package in place. Your competitors likely offer similar benefits. Today, the top talent is looking for special benefits that that go above and beyond when making their next career decision. These special benefits can be the primary decision-making factor for key employees to join and remain loyal to your company. The following outlines some incentive benefit plans that not only can effectively attract and retain key people, but may provide important benefits to your bottom line as well.

Non-Qualified Deferred Compensation Plan (NQDC)

• Often referred to as “golden handcuffs”
• Supported by permanent insurance
• Variable Universal Life may be utilized to provide investment growth opportunity
• Used to attract and reward select, highly compensated employees who have or are in danger of maxing out their qualified retirement plans by providing them with additional retirement income2
• Death benefit can be paid to the employee’s family when the insured dies
• You choose which employees are to be covered and the amount of benefit to be provided
• Benefit can be subjected to a vesting schedule
• The plan is paid for and owned by the business. It can be structured to recover premiums paid into the policy by your company through application of a higher death benefit. The retirement benefit or death benefit is tax deductible to the company when paid out and taxable to the employee or his or her family when paid out as a salary continuation retirement benefit.*

 Executive (162) Bonus Plan

• Supported by permanent insurance
• Variable Universal Life may be utilized to provide investment growth opportunity
• Used as an incentive plan for, and owned by, the employee
• The business pays the life insurance premium directly or indirectly through a salary bonus
• Can also be used to provide key employees with a benefit in addition to a qualified retirement plan
• You can choose which employees receive this incentive
• The employee has full access to the policy’s cash value and he/she chooses the beneficiary

The bonus amount is tax deductible to the company, provided the amount is considered reasonable compensation. It is taxed as ordinary income to the employee. At your discretion, an arrangement can be worked out with the employee to help cover the income tax liability.*

Individual Retirement Planning and Wealth Management

Executives are typically time-strained. Often, low attention is paid to planning for one’s own retirement until the event is imminent, and sometimes too late. We work with key executives to help bring their investments, insurance, retirement, estate, and tax planning into one comprehensive plan to minimize or eliminate the gaps that can leave them and their families under-prepared and under-protected. Services include:

• Personalized Financial Planning
• Updated and recalculated annually
• Plan implementation support
• Quarterly consultations to track, and adjust
• Company option to cover all, part, or none of annual planning fee

² Distributions under the policy (including cash dividends and partial/full surrenders) are subject to taxation up to the amount paid into the policy (cost basis). If the policy is a Modified Endowment Contract, policy loans and/or distributions are taxable to the extent of gain and are subject to a 10% tax penalty. Access to cash values through borrowing or partial surrenders will reduce the policy’s cash value and death benefit, increase the chance the policy will lapse, and may result in a tax liability if the policy terminates before the death of the insured.

*  Employers should consult with their own tax and legal advisors for further information on potential tax implications.