The president of a 50-person engineering firm contacted C.H. Dean with concerns about his firm’s 401(k) and profit-sharing plan. Participation rates and contribution levels by his employees are low, making it difficult for the company retirement plan to meet requirements that allow highly compensated employees to maximize contributions and the company match.
When he established the company retirement plan several years ago, the president did so with the following three objectives:
- Use the plan as a vehicle for his executive team to build wealth by maximizing contributions and the company match
- Provide a disciplined way for employees to save for their retirement
- Leverage the plan as a recruiting tool to attract, and ultimately retain, high-caliber employees
The president asked Dean to review the plan and offer guidance on how to achieve all three of his objectives.