Serving a wide range of business types
Grey Ledge Advisors offers a wide variety of business solutions including retirement plans, executive bonus arrangements for your key employees, and business valuation services. In today’s competitive talent market, you need to stand out as the employer of choice. At Grey Ledge Advisors, we have our fingers on the pulse of the employment market and offer insights on cutting-edge plan designs that help you attract, recruit, and retain your employees.
It can be as easy as changing enrollment eligibility on your 401(k) plan, or as complex as an executive benefit plan that is set up to reward your top talent on a short-term basis. Whatever the need, Grey Ledge Advisors can help.
We won’t rush you into an investment decision, because we know your practice or business comes first. We respect your commitment to your customers, just like we are committed to the success of our clients. You take care of them. Let us take care of you!Retirement Solutions Executive Benefits Funding Solutions
Grey Ledge Advisors provides a 401(k) platform for plan sponsors and participants dedicated to the accumulation of retirement assets with a planned, long-term focus. The program is designed to be efficient, easy to understand, and create long-term value.
The program aims to accumulate or maintain wealth over time with five key portfolio strategies: Capital Preservation, Conservative Income, Balanced, Growth, and Aggressive Growth. We seek to use the lowest cost and most appropriate investment options, generally with Exchange Traded Funds (ETFs), to build the portfolio in each strategy. Participants may always self-select investments from a comprehensive list of ETFs (Vanguard, SPDR, iShares, Schwab, etc.) if they wish.
Grey Ledge Advisors offers Traditional and Roth IRAs that provide flexibility to manage retirement and tax planning. We can help you determine if you are eligible and whether to contribute pre-tax (Traditional) or after-tax (Roth). Both have advantages, and we can help you decide which is right for you!
Start small, aim big! Not ready for a 401(k) plan? A SIMPLE IRA is an employer-provided plan that has an incentive match funding structure that works like 401(k) plans, in that employers match contributions and the funds are tax-deferred. Your contribution limits are lower, but they are also simpler and have lower administration costs.
- Profit Sharing is a retirement benefit program that can be added to a 401(k) plan which accepts discretionary employer contributions. The law does not require a set contribution amount. That means you can contribute each year as your income allows, or you can make no annual contribution at all.
- A 401(k) plan is an employee benefit that produces returns from a mix of investment tools.
Defined Benefit/Cash Balance Plans
A defined benefit plan is another employer-sponsored retirement plan that pays a monthly pension, lump sum, or combination of both. The value of the plan is calculated using a formula that considers length of employment, salary history, and other factors. A defined benefit or cash balance plan offers the largest qualified plan contributions, often far exceeding the defined contribution maximum.
Defined benefit plans are complex, and we can help you decide if they are right for you. We can help you design a new plan or we can analyze your current plan and make any recommendations for change. We can also review your funding options to help ensure the plan complies with all government regulations.
Simplified Employee Pension Plans (SEPs)
Whether you are self-employed, freelance, working on the side, or own a small business, a SEP allows employers to set aside money for themselves and their employees by using Traditional IRAs. A SEP does not have the start-up and operating costs of a conventional retirement plan and may allow for a contribution of up to 25 percent of income. A SEP is flexible for timing, and contributions do not need to be made annually.
It’s crucial that your organization put together the most attractive, competitive, and cost-effective executive compensation package. Baby Boomers are retiring in record numbers, leaving employers to compete in a more demanding employment environment.
Supplemental Executive Retirement Plans (SERPs)
SERPs pay executives a negotiated or agreed-upon amount of supplemental benefits primarily based on a vesting milestone and other eligibility conditions (e.g. retirement, years of service, etc.). As a non-qualified plan, one not governed by Employee Retirement Income Security Act (ERISA) guidelines, it can only be offered to highly compensated employees or executives who are limited in qualified plan contributions, which are governed by ERISA. The executive receives the payout based on an event-driven vesting schedule and pays taxes upon vesting, excluding 457(b)s which act more like 401(k)s. These plans are excellent retention tools.
Nonqualified Deferred Compensation Plans
SERPs have two plan types — 409(a) For-Profit Organizations and 457(f & b) Not-for-Profit Organizations — and are governed by IRS rules. These plans allow companies to enhance benefits and provide alternatives to executives. The plans can help defer tax liabilities and allow for structured payouts to meet the executive and the origination’s long-term retention and retirement goals. Nonqualified deferred compensation plans are extremely flexible and can be structured as milestone bonuses (retirement, years of service, etc.) or as a retention tool for an executive team and are specific to the executive.
Split Dollar Life Insurance
Collateralized split dollar life insurance plans are complicated and require a clear and detailed understanding of their use. The strategy shares the cost and benefit of the life insurance policy between the employer and the employee. The program (split dollar) and the product (life insurance) provide a tax preference benefit for the executive, and a retention opportunity for the employer, usually associated with milestones such as length of service or retirement. The primary reasons for using this type of plan are tax and regulatory-related. However, this needs to be looked at carefully as the cost of insurance can be prohibitive and the program has a long tail — twenty years or longer. The life insurance policy acts as collateral for the organization, which lends the premium to the executive. A promissory note is signed, and a plan document is created defining the terms of the agreement. When appropriate, this can be a very effective tool.
Endorsement or Economic Benefit Split Dollar Plans
These plans are similar to loan regime split dollar plans with the exception that it is a straight write-off for credit unions in terms of its expense. During the accumulation period, a credit union is the owner and beneficiary of the policy. Terms may be set up to pay an executive’s survivors a death benefit as well. Upon an executive’s retirement, the policy is endorsed over to the executive, creating a taxable event for the executive that can be offset by a double bounce-back to neutralize the tax impact. The policy’s death benefit and cash value are now available to the executive to use as they need to supplement their retirement income needs.
Post Distribution Asset Management
Grey Ledge Advisors provides personalized asset management services for your retiring executives. We have years of experience working with high-net-worth clients to protect and grow their portfolio value and provide an appropriate income during retirement. Our portfolio management services for our nonqualified deferred compensation plans or total benefits prefunding can be modified for an individual investor’s risk profile and income needs in retirement.
Company-Owned Life Insurance (COLI) can be integrated into an overall investment strategy for asset and/or balance sheet management. When the employer is a financial institution, the policy is called Bank-Owned Life Insurance (BOLI). It is used to hedge against the financial cost of losing executives to unexpected death, including the risk of recruiting and training replacements or the cost of funding corporate obligations to redeem stock upon the death of an owner.
Your funding solution conversation should start and end with a series of questions. Answers to these questions will help guide the process:
- What is the impact on our capital position in the short and long term?
- How long should I expect my capital to be tied up?
- How does the solution fit with my overall interest and balance sheet risk?
- What is my opportunity cost or risk?
- Should I use multiple programs or products to create the solution?
Individually Managed Accounts
Grey Ledge Advisors will prepare a detailed Investment Policy Statement for prefunding of future liabilities or general asset management plans. This document details investment types, return expectations, risk parameters and any special circumstances that could affect the client’s financial objectives. We take an active approach to producing returns while managing market volatility, and take the time to review results with our clients and the governing Board of Directors or Finance Committee.
All accounts are managed to optimize the investments used to meet the client’s objectives. We select securities by combining the client’s objectives (Investment Policy Statement) with the lowest cost of ownership. Clients own the actual securities and diversify with other assets and positions instead of using a product from a provider (e.g. Mutual Fund Families). This creates an overall best value approach and goes to one of Grey Ledge Advisors’ core values of transparency.
This type of policy can be integrated into an overall long-term investment strategy for asset and/or balance sheet management. An investment in BOLI/COLI (Bank- or Company-Owned Life Insurance) provides a fixed-rate return for a period of time. It can also be used to hedge against the financial cost of losing executives to unexpected death, including the risk of recruiting and training replacements.