Profit sharing plans allow plan sponsors to make discretionary contributions to their employees’ retirement accounts. On the surface, they are often simple and easy to understand. However, there are a variety of allocation strategies and plan designs that can allow plan sponsors to customize plans to meet very specific goals and objectives – for the owners, the company and the employees. Among these:
- New Comparability, Integrated or Pro-Rata contribution Allocation Formula
- 1,000 hour and Last Day of year allocation requirements
- Eligibility and vesting provisions
- Compensation definition
Investments in profit sharing plans can be participant-directed, trustee-directed, or a combination of the two. We have experience in managing profit-sharing plan portfolios, and an extensive, proven investment education process to help employees in participant-directed plans make prudent, long-term decisions with their plan investments.