Pre‑Sale Playbook: Install or Optimize a Cash Balance Plan Before You Sell

Pre‑Sale Playbook: Install or Optimize a Cash Balance Plan Before You Sell

If a transaction is on the horizon, a CB plan can accelerate pre‑tax savings, clean up diligence, and improve your negotiating position when timelines and funding policies are clearly documented.

Why before a transaction?

Accelerated pre‑tax savings in final high‑income years.

Cleaner diligence—buyers value predictable, well‑documented plans.

Better negotiations—clear funding ranges and freeze/terminate options.

Timeline (start 6–12 months pre‑LOI)

Feasibility & illustration.

Select design (pay credits, interest crediting, funding policy).

Coordinate the 401(k) (safe harbor, profit sharing, coverage/testing).

Implement & document (plan doc, resolution, notices, funding calendar).

Deal language (funding through close; keep/freeze/terminate).

Key design levers

Contribution ranges for strong vs. lean years.

Fixed or permitted market‑rate interest crediting.

Partner classes/age bands to align value pre‑exit.

Freeze or terminate?

Freeze stops new accruals; termination requires full funding and proper settlements. We deliver the roadmap and filings.

Plan Sponsor Action Checklist

Checklist

Start feasibility 6–12 months pre‑LOI with your actuary and CPA.
Checklist

Agree on a funding policy and interest credit that fits risk tolerance.
Checklist

Document freeze/termination options in the purchase agreement.
Need help? Our team can design and implement your CB + 401(k) strategy.
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