Nonqualified Benefits Counter Quiet Assault on Retirement Plans

Scharff Jr., Robert L.
April 1996
Journal of Financial Planning;Apr96, Vol. 9 Issue 2, p75
Academic Journal
This article focuses on various retirement plans with an emphasis on preparations made by financial planners for that purpose. Although they have lived with the Omnibus Budget Reconciliation Act of 1993 (OBRA) for over two years, the people who run American business are still coming to terms with its effect on retirement plans. Out of necessity, employers are searching for options to help highly compensated executives restore retirement income lost to the legislation and other developments. At the same time, employers are searching for ways to attract and retain talented executives. Senior managers contemplating change will be uneasy about losing valuable benefits by switching to a new employer. In the past, companies were able to provide executives with adequate retirement income through qualified plans. OBRA and shifting employment also have made nonqualified benefits a topic that personal financial planners should understand, because now anyone earning $66,000 has a potential need for nonqualifted benefits to help ensure adequate retirement income. Another important issue affecting qualified plans is the reduction/postponement of the indexing of key benefit figures.


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