Attract Key Employees With Fringe Benefits


DSC_0018 (2)Fringe benefits are important to key employees. Here are some of the most popular benefits that will help you recruit and retain key employees:


Salary Continuation – Provides key people with additional income after their regular salary ends at retirement, disability or death. 


Split Dollar – A creative way for employers and employees to fund life insurance. The company pays all or part of the premiums for life insurance. The premiums are recovered from the death benefit or cash value in the future, and the balance goes to the named beneficiary. 


Executive Bonus program funded with life insurance – The business, the executive or both pay the premium on a key employee’s life policy. The bonused amount is deducted by business as a normal business expense and reported on the employee’s W-2. The employee owns the policy and reports the premium as taxable income. The employee’s cost is only the tax on the bonus, which may also be bonused so the employee’s out of pocket cost is zero. The employee owns the policy and holds all rights to cash values, policy loans and withdrawals.   

Deferred Compensation program funded with life insurance – Deferred compensation delays payment of a portion of a highly paid person’s income, thus avoiding current income taxes their deferral accumulates until retirement. It can also provide funds in case of early death or disability. 



For more information about this and other financial topics, contact me, Chris Lewis, Financial Services Representative, Principal Financial Group. Office 205.444.5597, Toll Free 800.253.7989 Ext 597, Cell 205.276.6115 or Email [email protected] .



BB11041  |  7/2008  |  #6521072010


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