Pros And Cons

  • Substantial benefits can be provided and accrued within a short time – even with early retirement

  • Employers can contribute (and deduct) significantly more than under other retirement plans

  • Plan provides a predictable benefit

  • Vesting can follow a variety of schedules from immediate to spread out over seven years

  • Benefits are not dependent on asset returns

  • Plan can be used to promote certain business strategies by offering subsidized early retirement benefits

  • Professional Administration Required