Originally Posted by
Iceberg
Are you saying that a greater company contribution to your retirement account hurts you?
You’ll have to break this one down, I’m not following your logic. DC contributions don’t draw PS just the same as DPSP payments. Your account would max sooner and you would get a larger check sooner. Where is the penalty?
I didn't explain that very well....shorthand for comparing straight line pay rates to increased DC contributions(wasn't very clear)
A straight line pay rate will always get profit sharing.
Bumping up the DC contribution is usually misunderstood by junior guys as the same as straight line pay rates cause the senior guy will hit the 415c limit quicker and then it just rolls over to DC excess so same/same in their mind cause they won't hit the 415c limit and get DC excess. So for them the 2 approaches are the same.
Unfortunately, DC excess doesn't get PS therefore all the DC excess loses 16ish% for the senior guy, all the while the junior guys are smiling
I think this is all correct(to the best of my memory)...if inaccurate it will be pointed out
Clear(er) now?