One way to help executives reach target retirement goals, improve retention and reduce the costs of unfunded benefit liabilities is through a supplemental executive retirement plan (SERP).

The 2007 Clark Consulting Executive Benefits Survey indicates that 67 percent of those companies polled maintain SERPs for their executives.

Benefit Restoration

SERPS are designed to restore benefits lost to regulatory restrictions on compensation used to calculate qualified pension benefits. With SERPs, executives do not defer current salary or bonus because the dollars used are provided entirely by the employer.

Types of SERPs include offset or excess benefit plans, which may be tied to the employer's qualified retirement plan. To calculate benefit formulas, employers select a defined contribution that specifies a calculation based on lost benefits. Other advantages:

• Create an additional incentive for high-level executives to join the organization
• Help retain key valuable executives
• Fulfill a particular income target at retirement

One of our benefit specialists is always available to assist in advising on the latest market trends and answer questions concerning the right application of SERPs.

Case Study: Sierra Health Services