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Cash Blanance

A Cash Balance Plan is a defined benefit plan that provides a contribution based on a percentage of salary and credits a rate of return on the contribution.  It is considered a hybrid plan because it combines the contribution limits of a defined benefit plan with account balances that look like a defined contribution plan.

​Overview

  • Considers salary only
  • Availability to equalize contributions for owners with the same compensation, but different ages
  • Account value builds at a steady pace
  • No employee contributions
  • Defines the benefit in terms of a stated “account balance”
  • Benefits are easier to understand compared to a traditional defined benefit plna
  • Employee’s vested “account balance” is paid at retirement or termination

Considerations

  • Annual contributions are required
  • Employer bears investment risk
  • Investment experience impacts contribution
  • Three-year cliff vesting required

Securities offered through ELE Wealth Advisors, Inc., member FINRA. Advisory services offered through ELE Advisory Services, Inc. EWAI and EAS are affiliated through common ownership and control. Financial Wealth Solutions, Inc. and 1st Consumer Insurance Agency Inc. are not affiliated with EWAI or EAS.
FINRA Broker Check https://www.finra.org/compliance-tools/rule-2210-brokercheck

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Centennial · CO 80112

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