Retirement Compensation Funding



Funding Solutions | PENSIONWrap 

PENSIONWrap - Status Quo RCA Funding for Public Corporations

  The Situation:

You and others are key employees of a public corporation. You are looking for a method of receiving full security of your pension promise over what can be funded by the company pension plan. There is no security attached to your Supplemental Executive Retirement Plan (SERP). The corporation is unwilling to fund a Retirement Compensation Arrangement (RCA) to provide the security because RCAs do not offer the same tax and investment efficiencies as the company's pension plan and the advantages for private corporations

  The Solution: 
  RcF's PENSIONWrap™  ‘wraps’ an Retirement Compensation Arrangement (RCA) around a company's pension plan, and is administered by the company's actuaries and investment managers. This eliminates the need for corporate post-retirement supplemental "pay-as-you-go" payments. This special supplemental pension plan utilizes the corporations ability to replace after tax earnings used to fund the arrangement at normal investment rates, with replacement dollars invested at the corporation's higher internal rate of return.

Benefits to corporation include:

  • Cash flow cost is the same as "pay-as-you-go"
  • It is balance sheet and P&L neutral
  • Can remove notation for unfunded pension liabilities
  • More cost efficient and eliminates concerns of RCAs with Letters of Credit.

And of course, the executive benefits from this because of the security of a fully funded pension at retirement. The PENSIONWrap is the best solution to address pension concerns for keys executives in Public Corporations with unfunded SERPs.


  This material is for information purposes only and should not be construed as legal or tax advice. Every effort has been made to ensure its accuracy, but errors and omissions are possible. Individual circumstances may vary and specific legal and tax advice is recommended.

This strategy is based on current tax legislation. Future tax changes and market conditions may affect this program


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