PLANSPONSOR - April/May 2018 - 65
way to communicate what can often be very complicated benefits
programs, " notes Harry Dalessio, head of Full Service Solutions
at Prudential. " Not only can a company's benefits package itself
be extensive, but the individual participant's situation needs to
be taken into account-taxes, estate planning and educational
expenses are just a few examples of financial planning elements to
be considered when making nonqualified plan elections, " he adds.
In a reversal of last year's survey results, more companies
this year are linking their NQDCPs to company stock and company
performance. For instance, in 2016 about 46% of large employers
offered stock option plans in addition to the NQDCP; this year
51% do so. About 11% of NQDCPs this year tie their investment or
crediting rate to company stock-whereas a year ago just 7% did.
Informal funding, whereby companies set aside assets to
finance NQDCP benefits, has remained steady at about 56-57% for
the past few years. Of those that do informally fund their NQDCPs,
44% this year are funding with corporate-owned life insurance
(COLI) (down from 55% last year). Mutual funds were slightly more
popular as an informal funding vehicle at 45%, up from 35% last
year. Nearly 49% of plans this year stated their reason for informal
funding was to manage the asset-to-liability ratio of the plan. " There
are many reasons to informally fund nonqualified benefit liabilities, "
says Dalessio, " It secures the incentive value of the plan and helps
ensure the availability of cash. In addition, informally funding and
placing the assets inside a security device like a rabbi trust is a way
of reducing risk with regard to a management change-in-control or
change of heart, " he concludes.
What is your criteria for eligibility?
Base salary/
Commissions
All Respondents
Annual Sales/
Revenues >$1b
Annual Sales/
Revenues <$1b
Total
Compensation:
Base + Bonus
12.9% 18.0%
15.0% 16.5%
7.8%
21.6%
To what is the investment or crediting rate(s)
in the NQDCP tied?
All Respondents
Annual Sales/
Revenues >$1B
Annual Sales/
Revenues <$1B
Outside index* 13.8% 14.4% 12.5%
Company
stock/
Performance
units
Market-based
investments
11.2% 13.6% 6.3%
83.7% 84.8% 81.3%
Other
8.2%
9.1%
6.3%
No NQDCP
changes
planned
Yes
(adding/
enhancing
features)
Yes
(reducing
features)
Yes
(eliminating
plan)
* Outside index (e.g., Moody's bond index) fixed rate or company performance rate
Title
Salary + Title
Job Grade
Other
18.5% 16.9% 21.9% 11.8%
15.0% 16.5% 24.4%
27.5% 17.6%
15.7% 9.8%
Are you considering changes
to your NQDCP?
All
Respondents
Annual Sales/
Revenues >$1B
Annual Sales/
Revenues <$1B
12.6%
81.0% 82.4% 77.4%
14.1% 12.2% 18.9%
2.2% 2.3%
2.7% 3.1%
1.9%
1.9%
PLANSPONSOR - April/May 2018
Table of Contents for the Digital Edition of PLANSPONSOR - April/May 2018
2018 Plan Sponsors of the Year
Plan Administration Guide, Part 1
From Strength to Strength
Finding the Best Course
Managed Accounts
Rising Costs
Taking Responsibility
PLANSPONSOR - April/May 2018 - C1
PLANSPONSOR - April/May 2018 - FC1
PLANSPONSOR - April/May 2018 - FC2
PLANSPONSOR - April/May 2018 - C2
PLANSPONSOR - April/May 2018 - 1
PLANSPONSOR - April/May 2018 - 2
PLANSPONSOR - April/May 2018 - 3
PLANSPONSOR - April/May 2018 - 4
PLANSPONSOR - April/May 2018 - 5
PLANSPONSOR - April/May 2018 - 6
PLANSPONSOR - April/May 2018 - 7
PLANSPONSOR - April/May 2018 - 8
PLANSPONSOR - April/May 2018 - 9
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PLANSPONSOR - April/May 2018 - 11
PLANSPONSOR - April/May 2018 - 12
PLANSPONSOR - April/May 2018 - 13
PLANSPONSOR - April/May 2018 - 14
PLANSPONSOR - April/May 2018 - 15
PLANSPONSOR - April/May 2018 - 2018 Plan Sponsors of the Year
PLANSPONSOR - April/May 2018 - 17
PLANSPONSOR - April/May 2018 - 18
PLANSPONSOR - April/May 2018 - 19
PLANSPONSOR - April/May 2018 - 20
PLANSPONSOR - April/May 2018 - 21
PLANSPONSOR - April/May 2018 - 22
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PLANSPONSOR - April/May 2018 - 53
PLANSPONSOR - April/May 2018 - 54
PLANSPONSOR - April/May 2018 - 55
PLANSPONSOR - April/May 2018 - Plan Administration Guide, Part 1
PLANSPONSOR - April/May 2018 - 57
PLANSPONSOR - April/May 2018 - 58
PLANSPONSOR - April/May 2018 - 59
PLANSPONSOR - April/May 2018 - 60
PLANSPONSOR - April/May 2018 - 61
PLANSPONSOR - April/May 2018 - 62
PLANSPONSOR - April/May 2018 - 63
PLANSPONSOR - April/May 2018 - 64
PLANSPONSOR - April/May 2018 - 65
PLANSPONSOR - April/May 2018 - 66
PLANSPONSOR - April/May 2018 - 67
PLANSPONSOR - April/May 2018 - From Strength to Strength
PLANSPONSOR - April/May 2018 - 69
PLANSPONSOR - April/May 2018 - 70
PLANSPONSOR - April/May 2018 - 71
PLANSPONSOR - April/May 2018 - 72
PLANSPONSOR - April/May 2018 - 73
PLANSPONSOR - April/May 2018 - 74
PLANSPONSOR - April/May 2018 - 75
PLANSPONSOR - April/May 2018 - 76
PLANSPONSOR - April/May 2018 - 77
PLANSPONSOR - April/May 2018 - Finding the Best Course
PLANSPONSOR - April/May 2018 - 79
PLANSPONSOR - April/May 2018 - Managed Accounts
PLANSPONSOR - April/May 2018 - 81
PLANSPONSOR - April/May 2018 - Rising Costs
PLANSPONSOR - April/May 2018 - 83
PLANSPONSOR - April/May 2018 - Taking Responsibility
PLANSPONSOR - April/May 2018 - 85
PLANSPONSOR - April/May 2018 - 86
PLANSPONSOR - April/May 2018 - 87
PLANSPONSOR - April/May 2018 - 88
PLANSPONSOR - April/May 2018 - C3
PLANSPONSOR - April/May 2018 - C4
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