Retirement Plans

Question 1

Money Purchase Plans

Answer 1

Must be funded annually

Can be integrated with SS

Plat % between 0 and 25%

Question 2

Target Benefit Plan

Answer 2

Benefit is predictable once initial costs are determined.

Age-weighted; favors older employees

All contributions come from the employer

MPPP with contributions allocated based on age and compensation

Question 3

Excess Method - Social Security Integration

Answer 3

Maximum excess contribution is the LESSER OF:

1) 2x the base rate, or;
2) Base rate plus 5.7%

Example
Base rate = 5% -> Max percentage above threshold is 10%
Base rate = 6% -> Max percentage above threshold is 11.7%