WHAT WE OFFER

CASH BALANCE

Smarter Co-op Retirement Options

Associated Benefits Corporation (ABC) offers a Market Rate Cash Balance program that is a modern retirement solution designed for today’s cooperatives and their teams. This flexible, transparent plan gives employees peace of mind for the future while helping co-ops attract and retain top talent.

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Understanding the Plan

A cash balance pension plan is a type of defined benefit retirement plan that works much like a 401(k), but better. Each employee has a notional account that grows in two ways:

  1. Employer Contributions: A percentage of salary that grows with years of service.
  2. Interest Credits: Tied to market performance and offering the potential for greater growth over time.

Employees do not contribute, so the plan is fully funded by the employer. This makes it a true added benefit.

The ABC Market Rate Cash Balance plan combines market-based growth with guaranteed security. Investments are managed by top-tier professionals. Employees can easily track their account value, and the account is portable within certain limits, giving employees flexibility if they change jobs.

BENEFITS FOR EMPLOYEES

When it is time to retire, employees have flexible payout options.

This flexibility helps employees tailor their retirement strategy to their lifestyle, goals and risk tolerance.

Flexible payout options:

  • Lump-Sum Payment: Roll the funds into a qualified retirement plan like an IRA.
  • Guaranteed Lifetime Income: Steady monthly payments for life, often at a lower cost than comparable annuities.
  • Combination: A mix of lump sum and lifetime income for more control.

A STRATEGIC INVESTMENT FOR COOPERATIVES

The Market Rate Cash Balance program is not just good for employees; it is also a smart move for co-ops.

Built with input from co-ops, this plan modernizes retirement planning while preserving the legacy of traditional pensions.

Cooperative Benefits:

  • Predictable, Stable Costs: Reduces financial risk and simplifies funding.

  • Fair Value Across Ages: Unlike traditional pensions, benefits are spread evenly across all employees.

  • Tax Advantages: Contributions remain tax-deductible, and the plan can transition from a traditional pension using excess assets.

A Path Forward

As cooperatives evolve, retirement benefits must evolve as well. ABC’s Market Rate Cash Balance program delivers a competitive, sustainable solution while honoring the past and providing the flexibility employees expect today.

For more information or to discuss how this plan can support your team, call us at 1-800-747-4421.

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