Benefit Restoration Strategies

Benefit Restoration Strategies

Fulcrum Partners Executive Benefits News

Benefit Restoration Strategies: Creating Long-Term Value for Companies and their Executives

Fulcrum Partners provides the following case study of a family-owned company that had an outdated shareholder agreement. Further complicating the company’s problems were: (1.) the need to retain certain key employees, and (2.) a pattern of flat earning in recent years.

This case study provides straightforward insights into the problem and its answers. Review the report to see examples of the multiple opportunities created when applying the flexible solutions proposed by the team at Fulcrum Partners.

Overview of Benefit Restoration Problems and Strategies

Summary of: Business Succession Planning; Ownership Transition; and Key Employee Rewards, and how deferred compensation under Section 409A is often the solution.

Buy/Sell Planning

  • Entity stock redemption—fewer shares outstanding—no basis change
  • Cross purchase–owners insure each other and buy deceased shares—Basis increase
  • Hybrid

Split Dollar Life Insurance

  • Used often when the person or entity that needs the proceeds does not have the resources to pay for insurance, or as an executive benefit.
  • Endorsement method
  • Collateral assignment

Estate Tax Planning

  • With two generations (or more) involved, we are presented with challenges and opportunities. Challenges primarily are to avoid increasing the senior generations estate without giving up control. Opportunities are to bypass the traditional taxable transfers and thereby legally avoiding estate tax.

Long Term Incentive for Key Employees

  • We all know the challenges of retaining and rewarding key people in successful family businesses. How can we help our clients win the war for talent?

You can download the PDF Creating Long-Term Value for Companies & their Executives here.

Securities offered through Valmark Securities, Inc. Member FINRA,  SIPC, 130 Springside Drive, Akron, OH 44333-2431, Tel: 1-800-765-5201. Investment Advisory Services offered through Valmark Advisers, Inc., which is a SEC Registered Investment Advisor. Fulcrum Partners LLC is a separate entity from Valmark Securities, Inc. and Valmark Advisers, Inc.

 photo credit: Aidan Bartos

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