Substantial risk of forfeiture, exposure to claims of creditors, large balance sheet accruals and embarrassing lump-sum payments on the front page of your local paper. Does this sound like an optimal retirement accumulation plan for your highly compensated physicians and executives?Read More
MKA Executive Planners Blog
Section 457(b) and 457(f) plans are the most common supplemental retirement accumulation plans utilized by tax exempt organizations. While many provisions apply to both models, the rules applicable to 457(f) plans are particularly onerous. Here are 8 ugly facts about Section 457(f) plans.Read More
For most people retirement planning is about the number. How much do I need to have invested at retirement to support my lifestyle for the balance of my life? In most cases financial advisors will structure an investment savings program based upon five primary considerations: (1) how long before your retire, (2) how long will you live after retirement, (3) what is an appropriate assumed after tax rate of return on investments, (4) an appropriate rate of inflation, and (5) other sources of income such as social security, or pensions. This is a daunting task with a number of important variables.
The current disconnect between payments made to health care systems and the compensation plans of physicians employed by them is an elephant in the waiting room. Unlike the smooth pendulum swing of the 1990s from fee-for-service to global payments, there are now several new flavors of risk and most organizations are trying them all. Fee-for-service, shared savings, alternative quality contracts, bundled payments and global capitation all require a different approach to maximize value. Yet other than niche organizations that focus on one brand of risk and pair it with appropriate reimbursement, is anyone actually doing that?
The Boston Herald recently published an opinion piece by Barry Koslow that focuses on some of the problems the Massachusetts retirement system is facing. Here’s how the piece begins:
The media and the public (not sure which drove which) have become frenzied over executive compensation, making broad-brush examples out of a few outliers. It is time to settle down and realize the importance of a proper balance between what is actually “bad” and what is not. Legislation and regulation are not the answer. We need careful analysis, decision making and the willingness to act on behalf of both employees and the organization.
It is becoming more and more obvious that we all need to pay more attention to our long term need for capital accumulation. Concerns are growing that the current dysfunction of our federal government and the continuing growth of entitlement programs may force more and more of the middle and upper classes to become self-reliant. It is not a question of approval of the current direction of government. It is whether the resources will be there to meet the promises made, while providing for other needs such as defense, infrastructure, etc.
Periodically, activists and the press engage in challenging the value of executives and their compensation, especially for executives at not-for-profit organizations or non-stock for-profits such as mutual banks and insurance companies.
While there are many reasons that a Board should consider, design and implement supplemental benefit plans for their top executives, professionals and performers, this discussion will focus on five of them.