Qualified Retirement Plans … with nuance

A Qualified Retirement Plan is any employee sponsored retirement plan that meets the requirements of Internal Revenue Code Section 401(a) of the Internal Revenue Service (IRS). These plan types create business tax deductions for businesses and income tax deductions for enrolled employees. At NestEggs, we offer the following Qualified Retirement Plans:

  • 401(k) (all types)
  • Profit Sharing Plan
  • Cash Balance Pension Plan
  • Defined Benefit Pension Plan
  • 403(b) Plan
  • Employee Stock Ownership Plan (ESOP)

However, we don’t sell cookie cutter plans and we don’t guess on what plan would work best for an employer. As a part of our consultation and proposal process, we sit down with the employer and learn about their goals and objectives for their employees and their plan. We also collect data on the employee demographics. With all of that information, we then custom-build plan ideas for that business. As a decision maker or owner, you should be asked a litany of questions during the proposal stage including:

If you, your partners or upper level executives could contribute up to $50,000, $100,000 or even $200,000 per person, annually, into the retirement plan and shelter that money from income tax, would you?
If you could strategically give tax deferred bonuses to key personnel that don’t vest for a full six years in order to keep them around, would you?
If you could utilize eligibility requirements within your plan to incentivize employee growth and loyalty, would you?
If you could revisit your employee costs annually and nip and tuck as necessary every year, would you?
Do your business revenues and demographics change a little bit every year?
If you answered yes to any of these questions, then the main question you should be asking is … why do I not have a plan that is custom-tailored to my business today and that can evolve with it tomorrow?


ERISA legislature and the Department of Labor regulate qualified retirement plans. The purpose of the regulations are to ensure that retirement plans do not benefit highly compensated employees more than they benefit non-highly compensated employees, within certain parameters. Complex, annual non-discrimination testing is required to ensure a Plan remains compliant.


The most expensive part of a company retirement plan is not the fees, but the lost tax benefit that occurs for business owners that use a generic plan design that is not customized to the business. Sadly, the big-box insurance brokerages and most third-party administrators provide exactly that: generic plans. Why? We can only speculate, but it may be because not all parties involved know the full capabilities of creative Plan design, or maybe it’s strategic to keep their operations efficient due in navigating the complex rules associated with the non-discrimination testing mentioned above. But the reality is, a plan CAN BE designed to maximize owner and highly compensated employee benefit while still keeping the related employee costs manageable. It simply requires a lot more time and knowledge of the Internal Revenue Code to achieve both design goals. NestEggs can often achieve an owner-oriented plan while keeping employee costs reasonable. We consult business owners throughout our relationship together because as your business evolves, your plan should too. Our consultative approach is rare in the market and puts you, the business owner, in the driver’s seat to maximize your plan to work for you!
* "SEC Registered Investment Adviser" does not imply an endorsement by the Securities and Exchange Commission, nor does it indicate the adviser has achieved any specialized skill or training.