Our Step-By-Step Process

Evaluating your organization’s unique needs.

Delivering effective, customized solutions.

Image

Objectives and Design Issues

STEP 1: Discussion Of Objectives And Design Issues

  • Background information on deferral plans:
    • What is most common
    • Legal issues
  • Discussion of current objectives:
    • From the Company’s perspective
    • From the executive’s perspective
    • Executive interviews
  • Discussion of preliminary design issues:
    • Index plans versus variable account plans
    • Payout options:
      • Retirement
      • In-Service Distribution
    • Participant security
  • Determine eligible executives
  • Impact on other benefit plans

STEP 2: Preliminary Design Of Plan

  • Evaluation of current agreements
  • Initial plan design based on discussion in Step 1
  • Investment choice analysis:
    • Determine fund classes appropriate for Deferred Compensation Plan (DCP)
      • Analysis of funds:
        • Fund histories
        • Investment risk
      • Compare to current 401(k) funds
  • Financial impact from deferral plan (unfunded):
    • Cash Flow
    • P&L Impact
    • Balance Sheet

Preliminary Plan Design

Funding Analysis

STEP 3: Funding Analysis

  • Review of funding approaches:
    • Tax-free versus taxable investments
  • Cost efficiency of funding approaches using:
    • A variety of crediting rates for the deferred compensation plan
    • A variety of investment rates of return
    • Corporate tax bracket
    • Discount rates
  • Financial impact:
    • Cash flow, net present value, internal rate of return
    • P&L impact
    • Balance sheet

STEP 4 - Benefit Security Issues

  • What level of protection is desired?
    • Change in Control
    • Change of Heart
    • Bankruptcy
  • Review of Security Devices:
    • Rabbi Trusts
    • Rabbicular Trusts
    • “Haircut” Provisions
    • Secured Trust
    • Split-Dollar
    • Indemnity Insurance

Security Issues

Recommendations

STEP 5: Develop And Process Recommendations

  • Final report
  • Prepare Board overview
  • Board presentation (if desired)

STEP 6: Implementation

  • Specimen documents
  • Enrollment materials:
    • Plan Summary
    • Question and Answer Section
    • Directions for Enrollment
    • Election Forms
    • Beneficiary Designation
    • Spousal Consent
    • Notice of Non-Participation
    • Plan Document
    • Prospectus for Benchmark Funds
    • Sample benefit statements
  • Enrollment meetings:
    • Onsite
    • Tele-conference
    • Personal phone calls

Implementation

Administration

STEP 7: Plan Administration

  • Account Teams:
    • Account Manager
    • Benefit Analyst
    • Financial Analyst
  • Participant Benefit Statement
  • Account History
  • Investment Changes
  • Company Financial Information
  • Participant Questions
  • Plan Changes
  • Monitor legislative and regulatory issues affecting plan

Our Focus


Fulcrum Partners Expertise


Cash Compensation

  • Base salary
  • Annual bonus
  • Annual incentive bonuses
  • Long-term incentives
  • Pay for Performance

Qualified Plans

  • Defined benefit pension
  • 401(k)
  • ESOP profit sharing

Fulcrum Partners Expertise

Nonqualified Plans

  • SERPs
  • Deferred compensation plans
  • Long-term incentive plans
  • Supplemental disability
  • Long-term care
  • Life insurance

Equity Plans

  • Stock options
  • Restricted stock
  • Phantom stock
  • Stock appreciation rights

Group Benefit Plans

  • Qualified group benefits
  • Survivor income
  • Employment agreements
  • Change in control

Learn more about the difference we make for executives and organizations.

Name
How would you like to subscribe?
Get news as it's published, or get our newsletter with key updates 2-3 times per month.
This field is for validation purposes and should be left unchanged.

Your information is secure.