|Retirement Plans and Actuarial Services|
Designing a Defined Benefit Plan for a Regional Bank
We were retained by the Board of a regional bank to design and install a new defined benefit plan covering substantially all of their employees, including many with long service. We worked with a special committee of the Board to present alternative plan designs and actuarial cost studies, to develop a design the bank could afford that would provide both a retention incentive and a retirement reward.
The selected plan design included a final ten year average pay benefit. The ten year average kept costs from escalating as employees neared retirement. The plan featured normal retirement at age 65, and early retirement after age 55 with 25 years of service.
We prepared communications materials and conducted employee meetings to introduce the plan. We provided annual employee benefit statements, and actuarial and administrative services. All the bank senior officers at the time we designed the plan have retired, demonstrating the success of the design in achieving the retention goal.
Designing Partner Retirement Plans for a Large National Law Firm
This law firm is the product of a merger of two substantial firms with varying views on the roles of benefits and Partner retirement income. As the business matured and prospered, it became clear the retirement plan could be influential in attracting, retaining and then retiring Partners.
Our role was to design a supplemental retirement plan to achieve firm needs while addressing the current disparate supplemental retirement programs from the legacy firms. We reviewed the Partner demographics, studied costs and then presented plan design alternatives. These proposed plans recognized one legacy firm had significant unfunded liabilities for an unfunded, non-qualified Partner plan, and the other legacy firm had only a modest predecessor program.
The selected design provided service credit for Partner years, and recognized compensation over a Partner’s career. This approach controlled future costs while providing a significant benefit to long service Partners.
Designing a SERP (Supplemental Executive Retirement Plan) for a Mutual Life Insurance Company
This client requested a new senior executive plan to rapidly accrue retirement benefits which tied in with their ten year business plan. Their objective was to offer a cash benefit to compete with stock-based plans from companies where they wished to recruit executives.
We designed and implemented a plan covering ten executives based on total cash compensation, with fairly rapid vesting and a significant change-in-control benefit. The result was that almost all executives stayed with the company for the desired time frame, and ultimately earned substantial benefits from this plan.
Designing an ESOP (Employee Stock Ownership Plan) for a Company in Transition
This employer wanted a plan to reward employees in the event of a sale of the company. This plan would recognize employees and owners without a significant expense prior to a sale.
We worked with the client team to design a modest ESOP resulting in employees receiving stock ownership each year. The ESOP was helpful in keeping employees at the firm during an uncertain time, and then benefitting from the ultimate sale of the company.