If your business is seeking an opportunity for a greater tax deduction and a way to help key employees maximize benefits, especially over a short period of time, you may want to consider a cash balance plan.

1. If your business is seeking an opportunity for a greater tax deduction and a way to help key employees
maximize benefits, especially over a short period of time, you may want to consider a cash balance plan.
Here are some of the key advantages a cash balance plan can offer:
Flexibility
Cash balance plans afford greater design and contribution flexibility to allow employers to provide different benefits
for different groups of employees. This allows a business to achieve a greater degree of plan customization through
either an age-based or service-based design which provides higher allocation rates to older or longer-service
plan participants.
Increased Contribution & Tax Deductible Limits
Because of their unique plan design features, these plans enable key employees to save more than they can under
the current defined contribution plan limits, while still enjoying the ERISA protections that come with a qualified
retirement plan. Cash balance plans offer contribution limits over and above defined contribution plan limits.
This provides the organization with higher tax deductible contribution limits than a 401(k) or other defined
contribution plan on its own.
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WHY OFFER A CASH BALANCE PLAN?
2 Enterprise Drive, Suite 408 Shelton, CT 06484-4694 800•872•3473 tel 203•925•0674 fax www.pentegra.com

2. Simplicity
Cash balance benefits are structured in a way that is easily communicated to and understood by employees.
Employees are better able to appreciate the value of the plan since benefits are communicated in the form of a
lump sum account balance, including employer provided allocations and investment earnings.
Portability
Employees in today’s workforce are increasingly more mobile. Cash balance plans are structured to allow employees
who terminate for any reason at any age to access their retirement monies upon termination. This allows employees
to rollover their account balance to an IRA or to a new employer’s qualified plan. Portability reinforces participant
appreciation as benefits may be distributed at any age as a lump sum payment. Alternatively, benefits are also available
as an annuity.
Cost Control
Cash balance plans tend to reduce pension costs because benefit targets are based on participant’s current salary
rather than their projected final average salary. In this sense, cash balance plans are similar in design to career
average traditional defined benefit plans. Employers typically find they can get “more for less” by providing a more
easily understood and appreciated benefit at a lower cost.
Benefit Security
Benefits at retirement are definitively determinable at any point in time and are guaranteed under the plan provisions
as well as the protections that come with any ERISA-qualified retirement plan.
PBGC Insured
Since a cash balance plan is a defined benefit plan, plan benefits are insured by the Pension Benefit Guaranty
Corporation.
Learn more about the Pentegra Cash Balance Advantage.
Contact the Pentegra Solutions Center at solutions@pentegra.com, or 855-549-6689.
2 Enterprise Drive, Suite 408 Shelton, CT 06484-4694 800•872•3473 tel 203•925•0674 fax www.pentegra.com