According to the Pension Benefit Guaranty Corporation, there are about 38,000 insured defined benefit plans today compared to a high of about 114,000 in 1985. They go on to state that this decline was due primarily to plans with 100 or fewer participants. One possible reason for this decline is the complexity and cost required by many of these plans.
Still, a defined benefit plan may be an option to consider when reviewing retirement plans. Why? Among the reasons are:
If you establish a defined benefit plan, you:
Pros and Cons:
Who Contributes: Generally, employer contributions. Sometimes, employee contributions are either required or voluntary.
Contribution Limits: Deduction limit is any amount up to the plan’s unfunded current liability (see an enrolled actuary for further details).
Filing Requirements: Annual filing of Form 5500 is required. An enrolled actuary (not an enrolled agent) needs to sign the Schedule B of Form 5500.
Call Shelly Dodge at 972/539-0002 today to schedule a complimentary consultation to discuss your investment options and to determine if a Defined Benefit Plan is right for you.