Executive Benefits
Defined Benefit Plans
| The retirement benefit provided by a Defined Benefit Plan is typically based on a target percentage of average high-three salaries. We work with the credit union to determine the appropriate formula based on the credit union’s qualified plan(s) and Social Security benefits and the Defined Benefit Plan. |
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The retirement benefit paid to the executive under a Defined Benefit Plan is a guaranteed benefit to the executive. These plans are typically funded with single premium life insurance policies. The life insurance policies offer many benefits to the credit union including: guarantee of principal plus a minimum return, competitive investment returns, and death benefit that protects the credit union and executive’s beneficiary.*
Defined Contribution Plans
Like the Defined Benefit Plan the retirement benefit provided by a Defined Contribution Plan is typically based on a target percentage of average high-three salaries. We work with the credit union to determine the appropriate formula based on the credit union’s qualified plan(s) and Social Security benefits and the Defined Contribution Plan.
In a Defined Contribution Plan the retirement benefit paid to the executive is tied to the investment performance of a specific investment asset purchased by the credit union. Our Defined Contribution Plans can be funded with single premium life insurance policies, mutual funds**, and fixed and variable** annuities. The Sheeter Group works with each credit union individually to determine which investment is most appropriate for their individual situation.
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Incentive Based Conpensation Plans
The goal of our Incentive Based Compensation Plans is to reward executives for hitting financial goals set by the credit union. The Sheeter Group can work with your credit union to develop an incentive formula based on financial and business plan goals. These goals can be used to create a stand-alone Incentive Compensation Plan or can be incorporated into a Defined Benefit or Defined Contribution Plan.
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Post-Retirement Health Care Plans
The question of where an executive will obtain Post-Retirement Health Care and how they will pay for it is a major concern for many executives. A Post-Reitirement Health Care Plan may be the answer.
Through a Post-Retirement Health Care Plan the executive can elect to receive a health care spending account at retirement that can be used income tax-free to pay for health care coverage during the participant’s retirement years. The Sheeter Group can fund a Post-Retirement Health Care Plan with single premium insurance policies.
The credit union can use this attractive benefit to retain employees by attaching vesting schedules to the Plan that require a participant to stay with the credit union usually until retirement to qualify for the benefit.
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Group Term Carve Out
Credit unions are able to “carve out” executives from Group Term Insurance Plans and provide them with life insurance protection through single or annual premium life insurance products. This plan reduces the cost of the Group Term Insurance Plan to the credit union.
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457(b) Plans
These plans allow credit union executives to make tax-advantaged contributions in addition to their 401(k) plan contributions. Pre-tax contributions are made into a 457(b) and are taxed deferred until they are withdrawn at retirement. The 457(b) allows executives to be vested in their contributions without creating a taxable event.
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*All guarantees are based on the claims-paying ability of the issuing company. Some products, riders, features and benefits may have additional costs, and may not be available in all states.
**Securities offered through NYLIFE Securities LLC.
New York Life Insurance Company bears no responsibiltiy for the establishment or administration of any health care spending account.
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