Project the growth of your Cash Balance Plan, a powerful 'hybrid' retirement plan used by high-income professionals and business owners.
Plan Details
Retirement Outcome
Projected Retirement Balance$1,236,821After 15 years
Plan Balance Growth
About this calculator
Overview
Project the growth of your Cash Balance Plan, a powerful 'hybrid' retirement plan used by high-income professionals and business owners.
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Pro Tips
What is a Cash Balance Plan?: A Cash Balance Plan is a type of defined benefit plan that looks and feels like a 401(k). The employer credits a participant's account with a set percentage of their yearly compensation (pay credit) plus interest (interest credit).
Who is this plan best for?: It is popular among high-earning small business owners and partners (like physicians or attorneys) because it allows for much higher tax-deductible contributions than a standard 401(k) or SEP IRA.
Is the interest rate guaranteed?: Typically, yes. The plan specifies an interest credit rate (e.g., 5% or the 30-year Treasury rate). The employer bears the investment risk to ensure this rate is met.
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Fun Facts
"Cash Balance Plans are 'hybrid' because they combine features of both defined benefit and defined contribution plans."
"Annual contribution limits for Cash Balance Plans increase with age, often exceeding $250,000 for participants in their 60s."
"At retirement, you can usually roll the balance over into an IRA or take it as a lifetime annuity."
