Global View Capital Advisors

Seeing the challenges many businesses have had in the last few years, including struggles with attracting and retaining quality employees, many businesses have been looking for ways to make themselves more competitive as they compete for the same limited talent pool. The business planning services we offer at Global View Capital Advisors can help you compensate yourself, your executives and provide the kind of benefits that can help you attract and retain a pool of talented employees and allow you to stand out from other firms.

Importantly, we also help with company succession planning. Rather than put this off, a succession or exit plan can help a business owner envision and create the realistic path for her or his own retirement. As part of what we do, we also help you put the safeguards in place to protect business continuity and family members in case of unexpected adverse events such as the death of an owner or key person. Please don’t put any of this off another day. It’s easy to offload the business planning to us, that’s what we’re here for.

What we mean by advanced planning at Global View Capital Advisors is providing additional compensation plans for your top executives and key employees with a view to the long-term. Non-qualified plans typically fall outside the scope of ERISA guidelines and other regulations which govern 401(k)s, SEP IRAs, and other group retirement benefit plans. They are usually added on top of a 401(k) to meet the needs of a select group of executives as a way to recruit, compensate, and retain key people. They are a way to provide highly-paid executives with an additional retirement savings option.

Deferred compensation plans, split-dollar life insurance, executive bonus plans and group carve-out plans are the four major types of non-qualified plans that you can put in place, often for people you want to retain but not sell or leave your business to. Each type of plan has specific features which may or may not be applicable to your firm. It is important for everyone involved to understand that this compensation is generally not tax-deductible for the employer, and it is generally taxable to the executive or employee recipient. However, employees can defer taxes until retirement.

Executive bonus plans are usually a permanent cash value life insurance policy purchased by the company which the employee receives upon retirement. Premiums may be considered compensation and therefore may be tax-deductible for the employer. In some cases, the company may choose to pay a bonus to cover the employee’s taxes which they will owe the IRS upon receiving the policy in retirement.

Split-dollar plans are similar to executive bonus plans, except that the employer and employee divide ownership of the permanent cash value life policy. For instance, the employee may pay for the life insurance or mortality cost and the employer may pay the rest of the premium. Upon death, the employer receives the portion of the death benefit equal to what the company has paid in, while the employee’s beneficiaries receive the balance.

A group carve-out plan is another life insurance strategy where the employer replaces a key employee or executive’s group term life insurance policy over $50,000 and replaces it with a permanent cash value individual policy. Thus, the employee receives $50,000 in tax-free term insurance (this is the typical IRS tax-free limit depending on age), plus a permanent life policy that can accumulate cash value over time.

We will help you analyze whether or not any of these advanced plans make sense for your situation and will present even more pros and cons for your consideration, always with your best interest in mind. Our goal is to win and keep your trust through the decades, and also help you with your own personal finances for the long-term.

As a business owner, having a succession plan in place helps ensure that you can retire someday, and if something unexpected happens to you before then, your business will continue to operate and your legacy will be preserved. Whether you choose to pass the business to partners, family members, or a select group of employees, we can help you discuss the different ramifications and put insurance policies in place which can help ensure the transition goes smoothly and that the liquidity is there to help finance your wishes. For instance, after meeting and putting together a strategy for you for business succession, you may choose to execute cross-purchase or buy-sell agreements.

Succession planning can help you retain trusted executives or employees that you would like to have run the business someday, while giving you a solid path to retirement. Knowing that you will have retirement funds and can pursue other personal activities after you exit can give you the focus and peace of mind you need. Knowing who will run things later on helps ensure that you get them involved in important decisions early, that you impart your values and company vision thoroughly, and that you help train them well for the roles they will ultimately fill. If you want your business to go on after you exit, creating a succession plan may be exactly what you need to do.