Summary & explanation of non-traditional designs for defined contribution and defined benefit plans that suit specific business needs including two plan combinations and hybrid plan designs
A defined-contribution (DC) plan is a retirement plan that's typically tax-deferred, like a 401(k) or a 403(b), in which employees contribute a fixed amount or a percentage of their pay checks to an account that is intended to fund their retirements. The sponsor company will, at times, match a portion of employee contributions as an added benefit. These plans place restrictions that control when and how each employee can withdraw from these accounts without penalties.
A defined-benefit plan is an employer-sponsored retirement plan where employee benefits are computed using a formula that considers several factors, such as length of employment and salary history. The company is responsible for managing the plan's investments and risk and will usually hire an outside investment manager to do this. Typically, an employee cannot just withdraw funds as with a 401(k) plan. Rather they become eligible to take their benefit as a lifetime annuity or in some cases as a lump-sum at an age defined by the plan's rules.
Defined benefit plans define the benefit ahead of time: a monthly payment in retirement, based on the employee’s tenure and salary for life. Their right is not to an account, but to a stream of payments and in defined-contribution plans, the benefit is not known, but the contribution is.
This online continuing education program will provide a summary and explanation with examples of non-traditional designs for defined contribution and defined benefit plans that suit specific business needs including two plan combinations and hybrid plan designs.
Key topics covered in this online CPE webinar:
-What are the alternate contribution plan designs? -What are money purchase plans? -What are target benefit plans? -What is class allocation profit sharing plan? -What is age weighted profit-sharing plan? -What is cash balance plan? -What is floor offset plan?
Field of Study: Finance
Stephen Abramson is the President and founding partner of APS Pension & Financial Services established in 1979, a mid-size consulting and actuarial firm employing twenty-two professional and support staff specializing in pension and pension-related services. For over 40 years, APS has been providing closely held businesses and non-profits with financial services including pension design and administration, business succession planning, and wealth preservation planning. In 2015 APS Investment Management was established to provide ERISA 3/38 fiduciary services to 401(k) and 403(b) plans and in 2018 APS Wealth Management, LLC, a Registered Investment Advisor (RIA), was established to provide investment management services to individual clients and retirement plans replacing a previous relationship with a Broker/Dealer. Steve has taught professional level education programs for the American Society of Pension Actuaries; lectured to various professional groups, including the National Conference of CPA Practitioners, The NYS Society of CPAs, provided continuing education webinars for the Foundation for Accounting Education (FAE), the Nassau Bar Association, the C.W. Post Tax Institute, and the National Institute of Pension Administrators; and conducted continuing education seminars for Certified Public Accountants for the past 35 years. Steve is an Associate member of the NYSSCPAs, a member of their Employee Benefit Committee, and chairs a sub-committee on Fiduciary Compliance. Steve also hosts webinars on various retirement plan topics, some of which are jointly sponsored by the NYSSCPAs through the Foundation for Accounting Education (FAE). He is co-author of Plan Smart, Retire Rich published by McGraw Hill in 1998; author of Advisor’s Guide to Qualified Plans originally published by Aspen Publishing in March, 2002 and recently updated with the 7th edition in 2018, and Retirement Financial Management for Clients Approaching Retirement published by Aspen Publishing in August, 2002. A less technical version of Advisor’s Guide to Qualified Plans entitled Guide to Qualified Retirement Plans: A Plain Language Primer was published by the International Association of Employee Benefits in March 2005. The second edition of this book was released in 2008. Steve graduated from Cornell University in 1964, earned the designation of Chartered Life Underwriter in 1967 from the American College, Certified Pension Consultant in 1970 from the American Society of Pension Professionals and Actuaries and Chartered Financial Consultant from the American College in 1972.
Provincial regulators of CPAs in Canada do not require that independent providers of CPD be approved to offer courses. Instead, individual CPAs are responsible for assessing whether a CPD activity meets their requirements, and may take activities from any source provided those requirements are met.
Every course offered on LearnFormula is delivered by a qualified subject matter expert or learning organization, and advances learning objectives that are relevant to the responsibilities or professional competencies of Canadian CPAs. All activities on LearnFormula are quantifiable in terms of hours, and are also verifiable, in that users receive documented evidence of their attendance via a certificate of completion after finishing a course (and this certificate is stored by LearnFormula indefinitely). Nearly 100,000 Canadian CPAs successfully satisfy their CPD requirements via LearnFormula on an annual basis.
