Money Purchase Plans
Money Purchase Pension Plans are a type of qualified defined contribution retirement plan that require a fixed annual employer contribution, typically expressed as a percentage of each eligible employee’s compensation. Unlike profit sharing plans, where contributions are discretionary, Money Purchase Plans are subject to a mandatory funding requirement each year as specified in the plan document.
Money Purchase Plans
While Money Purchase Plans are less commonly adopted today—largely due to the popularity and flexibility of Profit Sharing and 401(k) plans—they can still be beneficial in certain circumstances, particularly when combined with other plan types as part of a broader retirement strategy. At RBS, we help sponsors evaluate whether a Money Purchase Plan is the right fit for their organization, and provide the ongoing administration, compliance testing, and recordkeeping services needed to keep the plan operating smoothly.
Let’s Talk Retirement Plan Solutions
Connect with our team to explore custom fiduciary and consulting services tailored to your organization.