Non-Qualified Deferred Compensation Plans
Non-Qualified Solutions that Work
A powerful tool to help companies retain, attract, and motivate their employees – while strengthening their bottom line.
92% of Fortune 1000 companies offer NQDC to top talent
NQDC plans are not just for large- and enterprise-sized companies
12,000+ NQDC plans in the marketplace
80% plans use a financing strategy
Typically COLI (63%) and mutual funds (46%) fund over $206B in liabilities
1,000 new plans and 200,000 participants have been added since 2020
Business Challenges That Drive NQDC Popularity
Retirement gap
- Top staff is limited in retirement funding due to IRS limitations of traditional qualified plans
- Companies that often fail 401(k) discrimination testing
NQDC Solution: These plans supplement retirement savings beyond traditional plan limits.
Retention
- Can’t afford to lose key, highly specialized talented employees
- High commission, sales-driven teams often jump to other opportunities or are poached by competitors
- Closely held companies needing to attract and retain non-owner employees where equity-based compensation packages won’t be offered
NQDC Solution: These plans supplement retirement savings beyond traditional plan limits.
Results, revenue, risk reduction
- Need an avenue to incentivize team and align corporate goals
- Existing buy/sell or key-man policies in place
- Need alternative ways to boost the bottom line and reduce expenses
- Suitability assessment, not sure they know what they own
NQDC Solution: These plans supplement retirement savings beyond traditional plan limits.
Strategic Applications
Provide deferred compensation benefits to executives without the cost constraints of a qualified arrangement covering many non-executives.
Offer additional deferred compensation benefits to executives maxing out contributions under qualified retirement plans.
Provide tax-deferred compensation to key employees under different terms than other staff.
Executive or key employee seeks a tax-efficient, automatic program leveraging tax savings for future benefits.
Closely held company aiming to attract and retain non-owner employees unable to offer equity-based compensation like publicly held companies.
%
of employers find NQDC plans to be a valuable recruiting tool
%
of employers find NQDC plans to be a valuable retention tool
%
of employees say NQDC plans are an important factor in choosing a job
%
of employees say a NQDC plan would help retain them in their role
Why NQDC is Right for Your Organization
From addressing specific executive needs to navigating tax implications, NQDC plans offer a strategic advantage for organizations seeking to attract and retain top talent.
Employer Benefits
- Attract and retain top talent
- Minimize current tax liability
- Take advantage of tax-deferred growth
- Designed to fit company goals
Employee Benefits
- Defer compensation without restraint
- Leverage tax savings for future benefits
- Target mid- and long-term goals
- Bridge the retirement gap
Proprietary Solutions
Solutions that Complement NQDC
Lifetime Income Non-Qualified Solutions
Future-proof retirement with secure, lifelong income that cannot be outlived.
Newcleus’ Titanium Benefit Plan
A revolutionary deferred comp alternative offering tax-free income, unlike traditional taxable plans.
Supplemental Executive Retirement Plans
Custom SERPs boost retention, align goals, and support non-traditional life events.
Client Testimonial
“We did our first plan in 2013. We did a small amount for some key employees and that has just expanded over time to where it’s actually a very meaningful retirement benefit and very good retention tool.”
– Lynn Joyce CEVP, CFO Southern States Bank
Elevate Your Financial Benefits Strategy with NQDC
Connect with one of our expert NQDC Advisers and utilize a Non-Qualified Deferred Compensation arrangement to transform your financial benefits strategy and motivate your top talent to achieve company goals.
