NonQualified Benefit Plan Examples

Replacement Ratio Analysis

Current IRS and ERISA regulations place strict guidelines on employer-sponsored qualified benefit plans. These guidelines can severely discriminate against key employees by limiting their savings opportunities and retirement benefits. Most employees typically receive retirement benefits from Social Security and employer-sponsored qualified plans in excess of 70-80% of their final salary. Many times, however, highly compensated key employees receive significantly lower retirement benefits, equaling only 10-30% of their final salary. Do you know what percentage of your final salary you will continue to receive after you retire? If not, you and your colleagues may have to prepare for drastic post-retirement lifestyle changes.

By preparing a Retirement Income Replacement Ration Analysis, BCG can help you determine whether the executives and highly compensated employees of your financial institution will face a retirement income shortfall and can foster discussion regarding how to correct such shortfalls. Contact Bank Consulting Group.