PLANADVISER - March/April 2022 - 32

growing your practice / NQDC plans
ng y
r pr
tice / RFP
Another Retention Tool
T
his may be a good time to expand
into nonqualified deferred
compensation plans, for employers
seeking new ways to recruit and
retain key employees in this tight
labor market.
NQDC plans can meet a variety
they let highly
of needs. For one,
compensated employees save more
money, pre-tax, for retirement beyond
401(k) or 403(b) limits.
The applicable tax rules vary
between for-profit companies and
nonprofits. For-profit NQDC plans are
governed by Section 409A of the
tax code and permit both employer
and employee contributions. Some
employers match worker contributions.
Employers may also contribute to
NQDC plan accounts for signing
or performance bonuses; these
may grow, tax-deferred, for five to 10
years or until retirement, depending
on the plan.
Nonprofits may offer NQDC plans
under Section 457(b) or 457(f). 457(b)
plans have a $20,500 contribution limit
this year and may include employee
deferrals and employer contributions.
Employees may also make catch-up
contributions, with different rules
applying for nongovernmental vs.
governmental 457(b) plans.
Nonprofits may provide 457(f) plans,
as well. These have no contribution
cap but do have vesting requirements.
" Because 457(f) plans don't allow
immediate
vesting, the employee
deferral feature isn't used, " says Mark
West, national vice president of business
solutions for Principal Financial Group
in Des Moines, Iowa. " The vesting
requirement fits better with employer
money, as the employer's objective is
typically employee retention. "
An option for nonprofits is to offer
both types of 457 plans. " 457(b) and
457(f) fit nicely together-the 457(b)
for the employee money and the
457(f) for employer money, " says West.
" The usual place to start is with
Nonqualified deferred compensation plans can help build clientele
32 | planadviser.com March-April 2022 Art by Andrea D'Aquino

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PLANADVISER - March/April 2022

Table of Contents for the Digital Edition of PLANADVISER - March/April 2022

A Digital Divide
Staying Power
The Prospects of Staying Virtual
Another Retention Tool
Is It Time to Let Go?
The Evolving Use of RFPs
Best Interest Reasons For a Rollover
Guaranteed Lifetime Income
PLANADVISER - March/April 2022 - C1
PLANADVISER - March/April 2022 - FC1
PLANADVISER - March/April 2022 - FC2
PLANADVISER - March/April 2022 - C2
PLANADVISER - March/April 2022 - 1
PLANADVISER - March/April 2022 - 2
PLANADVISER - March/April 2022 - 3
PLANADVISER - March/April 2022 - 4
PLANADVISER - March/April 2022 - 5
PLANADVISER - March/April 2022 - 6
PLANADVISER - March/April 2022 - 7
PLANADVISER - March/April 2022 - 8
PLANADVISER - March/April 2022 - 9
PLANADVISER - March/April 2022 - 10
PLANADVISER - March/April 2022 - 11
PLANADVISER - March/April 2022 - 12
PLANADVISER - March/April 2022 - 13
PLANADVISER - March/April 2022 - 14
PLANADVISER - March/April 2022 - 15
PLANADVISER - March/April 2022 - 16
PLANADVISER - March/April 2022 - 17
PLANADVISER - March/April 2022 - A Digital Divide
PLANADVISER - March/April 2022 - 19
PLANADVISER - March/April 2022 - 20
PLANADVISER - March/April 2022 - 21
PLANADVISER - March/April 2022 - 22
PLANADVISER - March/April 2022 - 23
PLANADVISER - March/April 2022 - Staying Power
PLANADVISER - March/April 2022 - 25
PLANADVISER - March/April 2022 - 26
PLANADVISER - March/April 2022 - 27
PLANADVISER - March/April 2022 - 28
PLANADVISER - March/April 2022 - 29
PLANADVISER - March/April 2022 - The Prospects of Staying Virtual
PLANADVISER - March/April 2022 - 31
PLANADVISER - March/April 2022 - Another Retention Tool
PLANADVISER - March/April 2022 - 33
PLANADVISER - March/April 2022 - Is It Time to Let Go?
PLANADVISER - March/April 2022 - 35
PLANADVISER - March/April 2022 - The Evolving Use of RFPs
PLANADVISER - March/April 2022 - 37
PLANADVISER - March/April 2022 - 38
PLANADVISER - March/April 2022 - Best Interest Reasons For a Rollover
PLANADVISER - March/April 2022 - Guaranteed Lifetime Income
PLANADVISER - March/April 2022 - C3
PLANADVISER - March/April 2022 - C4
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