Executive Benefits Plans
Attract and retain quality executives to create long-term financial business stability and success.
Customized Benefit Plans
Supplemental Executive Retirement Plans (SERPs) can be used as a powerful tool to provide competitive and cost-effective employee benefit solutions.
At Earnest Consulting Group, we offer a wide variety of custom benefit plans designed to help you accomplish your goals.
Retention and Loyalty
SERPs help provide a powerful incentive for executives to remain with your credit union long-term.
Attract Top Talent
In a competitive job market, offering attractive executive benefits helps credit unions attract experienced and skilled leaders.
Financial Security
SERPs allow executives to accumulate additional retirement savings beyond traditional plans.
Customizable
Credit unions can tailor SERPs to meet individual executive needs.
Compete with Other Financial Institutions
Offering robust executive benefits allows credit unions to compete effectively with banks and other compelling benefit packages.
Creative Funding Designs
There are two prominent designs when choosing a SERP:
- Collateral Assignment Split Dollar (CASD/Split Dollar)
- 457(f) Deferred Compensation Plan
Your credit union’s goals will determine what structure is best.
Retain and reward key executives with non-qualified benefit compensation plans funded with targeted, flexible solutions. Let us deliver timely strategies that can balance market resilience with tax-efficient growth.
Collateral Assignment Split Dollar Life Insurance
Secure executive benefits with collateralized credit union funds to yield the target benefit while minimizing opportunity cost.
457(f) Deferred Compensation
Provide tax-deferred savings for high-earning executives to enhance retirement benefits and meet organizational goals.
Combination Plan - CASD and a 457(f)
Implement a combination of a Collateral Assignment Split Dollar and a 457(f) Plan while providing benefits to both the executive and credit union.
Elevated Leadership Benefits
- Let our experts get to know your credit union’s background, current situation, and goals
- Benefit from education initiatives that match your current governance structure
- Design non-qualified plans curated to each executive’s benefit levels
- Maximize plan effectiveness to reward and retain key executives while helping to mitigate risk
Emerging Trends
*NCUA 5300 Call Report
**CUES 2023 Executive Compensation Survey
Your Focused, Experienced Resource
Get the experienced representation you deserve. Leverage the ECG team’s collective knowledge and resources in the credit union space to manage your strategies and achieve your objectives efficiently.
Flexible Insurance and Investment Solutions
Protect and grow your investments with custom strategies for your unique financial goals. We’ll move and adjust quickly to the market and your needs, keeping our expertise at your disposal.
- Whole Life
- Fixed and Variable Annuities
- Managed Account Portfolios
- Guaranteed Investment Contract (GIC)
- Credit Union Owned Life Insurance (CUOLI)
- Structured Index Products
- Open Architecture
Frequently Asked Questions
How does a Collateral Assignment Split Dollar (CASD/Split Dollar) work?
- The credit union issues a loan to the executive
- The loan is secured by the life insurance policy
- The life insurance collateralizes the loan
- The credit union can book loan interest income on the loan based on the type of loan agreed to.
- If the executive remains employed and vests in the plan, the Executive will receive the benefits from the Split Dollar Plan. If the Executive leaves the Credit Union prior to vesting, the unvested portion reverts back to the Credit Union.
- The executive can take annual tax free withdrawals based on the current Cash Surrender Values in the plan at the time of withdrawals.
- *Withdrawing cash value, will reduce the policy’s cash value and death benefit, increase the chance the policy will lapse, and may result in a tax liability if the policy terminates before the death of the insured. Withdrawals are tax-free for amounts up to the total premiums paid into the policy.
- Annual reviews are held for the credit union and executive
- The executive can take annual tax free withdrawals based on the current Cash Surrender Values in the plan at the time of withdrawals.
- The Credit Union is paid back the loan balance upon the Executive’s death or before death. Excess death benefit is paid to the executive’s beneficiaries.
How does a 457(f) work?
- A vesting schedule and benefit amount(s) are established
- Customized to each individual participant
- Generates expense to the credit union
- Credit Union invests in Benefits Prefunding Account
- Investment income offsets the 457(f) plan
- Can invest more to offset employee benefit costs, if desirable
- Executive receives benefit/retirement income after “Vesting Date”
- Taxes are paid by executive at time of vesting
When to implement a SERP?
- You have a key executive who is critical to your organization’s success that you want to retain.
- You have an executive who has made a significant positive impact that you want to reward.
- You have an executive with essential experience, institutional knowledge, and relationships.
- You don’t have a recruiting tool in place to secure a smooth leadership transition as people retire.
- You don’t have a strategy in place to ensure commitment to your succession plan.
What are the first steps when implementing a SERP?
Ask for education and a consult! We will meet with you and your team to ask questions and learn about your credit union’s objectives. During this consultation, all participants involved will have full understanding of all the available options along with the pros and cons of each Plan and Product Type. We will then confirm your objectives to best align the plan design with the credit union’s financials.
Why ECG?
- We are singularly focused on this business and you!
- Our team has a combined 130+ years of industry experience
- Each client receives a customized approach for their specific needs
- We are nimble and quick to respond
- All key decision makers receive a thorough education on interested programs; including new executives and board members throughout the life of the plan
- Our plan designs are compliant and up to date
- All programs are reviewed & approved by our legal team
- Consult on current or merging programs
- We stay up to date on current market trends
Inquire Now
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