Executive Deferred Compensation Plans
Executive Deferred Compensation Plans or Top Hat Plans are retention tools that are frequently used by companies and organization to entice key executive to stay with their current employer for a specified period of time. This may be because the key employee is so vital that the company can’t afford to lose them. A key executive is difficult to replace which is why plans like this exist. Below is a summary of the plan features:
| Type of Company | Non-qualified |
| Eligible Employees | Select Executives & Owners |
| Annual Admin Cost | Less than $1,000 |
| Employer Contribution | Defined by the company |
| Vesting Schedule | Defined by the company |
| Payout Options | Defined by the company |
Since these plans are non-qualified plans, the company can hand pick who to cover and not cover with these plans. These plans also vary greatly in design. An agreement is drafted between the company and the key employee specifying the vesting schedule, dollar amount of the benefits, and payout structure. There must be “substantial risk of forfeiture” associated with the benefit for these plans to operate correctly. Companies also have a number of options when deciding how to fund the future liability associated with executive deferred compensation plan.
Welcome To Our Virtual Retirement Plan Services
For companies located outside of the Capital Region, we designed a virtual employer sponsored retirement plan platform that allows us to offer our clients:
- Easy Plan Setup
- Plans Consulting
- Low Fees
- Flexible Investments
- No Call Centers
- Employee Education (if applicable)
- Retirement Planning
- Video Conferencing For Review Meetings
Contact Us . . .
All of our services start with a complimentary consult. We can assist you in determining which plan is the right fit for your company.