Sherrett Insurance Agency Ltd.
Estate Planning, Corporate Benefits, Investments, Insurance, Retirement Planning
Quick Links
- Protect you and your family. Ask about life insurance.
- Buying a home? Own a home? Ask about mortgage insurance.
- Planning for retirement? Ask about RRSPs.
- Company need stability? Ask about securing funding.
- Company growing? Ask about employee benefit plans.
- Want long-term prosperity? Ask about succession planning.
- Access medical claim forms and renewal forms.
- Book a meeting.
Pension Plans
A pension is a tax-free way to save money to use as a retirement income. Offering your employees pension plans is an excellent way to find and keep good employees.
Types of Plans
There are two types of pension plans, qualified (or tax-qualified) and nonqualified plans. Within qualified plans there are:
- Defined benefit plans. In this type of plan, an employer pays a retired employee a fixed amount, based on factors like an employee's age, earnings, and years of service. Most employers fund their plans by placing money in dedicated investment funds under the control of professional money managers.
- Defined contribution plans. In this plan, employees contribute to their own pension accounts and assume a share of the investment risk. In some cases, the employer also contributes to the plan, usually by matching the employee's contribution.
Tax Advantages
Qualified plans offer several key benefits: growth inside a qualified plan is not taxable until it is distributed; employer contributions are tax-deductible; and employee contributions are also not taxable until they are distributed.
Nonqualified plans don't have these benefits. These plans are usually meant to provide deferred compensation for executives and high-level employees, and are not as well-suited for basic employee retirement plans.
Related Products:
- Employee Benefit Plans
- Group RRSP
- Health and Dental Insurance
- Life and Accidental Death and Dismemberment Benefits