Compensation Analysis

Client Data Input

John Jabobs52
Profit Sharing$16,800
Cash Balance$178,500
Profit Sharing$37,000
Cash Balance$151,900
Jenny W44
Profit Sharing$37,000
Cash Balance$113,400

AUM Report

Typical industry averages for advisors compensation on Defined Contribution AUM for 401(k) and Profit-Sharing plans can range between 25 and 60 bps. Contrast, cash balance plans and their assets require active management as advisors seek a rate of return or Interest Credit Rate (ICR) that may range between 2-6%. Due to these additional challenges and the skill level required, Advisors may choose to charge larger management fees of between 75 and 225 bps. Your AUM report conveniently shows a snapshot of your potential future earnings.

Name401(k) / PSP AssetsComp - 50 BPSCash Balance AssetsComp - 150 BPSAUM TOTALCOMP TOTAL
John Jacobs$41,800$209$178,500$2,678$220,300$2,887
Jenny W$56,000$280$113,400$1,701$169,400$1,981
Jeff M.$56,000$280$135,700$2,036$191,700$2,316

Insurance / Annuity Report

Alternative asset such as insurance and annuities may be held inside of retirement and cash balance plans. These investments can be a powerful aid to create a complete retirement planning solution for your clients. Typically, tax deductible life insurance purchased inside cash balance plans has a maximum investment of 50% of the cash balance contribution – which is illustrated below. The other 50% could go into an annuity or into the stock market. Below you may edit your compensation as needed.   

NameCash Balance AssetsInsurance 50%Insurance CompAnnuity 50%Annuity CompCOMP TOTAL
John Jacobs$178,500$89,250$80,325$89,250$4,463$84,788
Jenny W$113,400$56,700$51,030$56,700$2,835$53,865
Jeff M.$135,700$67,850$61,065$67,850$3,393$64,458