Reduce Your Taxes While Funding for Retirement

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A Defined Benefit Plan is a type of retirement arrangement. Traditional Plans often provide a percentage of pay at retirement, whereas Cash Balance Plans provide an account balance, much like a 401(k).

Under either arrangement, large tax-deductible contributions can be made each year, and amounts may be paid as a lump sum and rolled over to an IRA.

As a successful business owner, your expertise has provided you a comfortable living. Your ability to maintain that lifestyle in retirement depends on saving during your working years…but with a high taxable income, you need a retirement vehicle that allows for large tax deductions.

What if there was a retirement vehicle that allowed deductible contributions of $100,000, $200,000 or even $250,000 or more per year? Would you be interested? Fortunately, this level of annual contributions is possible using a Defined Benefit Plan.

Defined Benefit Plans allow for large annual contributions that are tax-deductible, grow tax-deferred and can be rolled over to an IRA at retirement. Deductible contributions in a Defined Benefit Plan can be significantly higher than other retirement arrangements.

The ability to make large, tax-advantaged contributions is particularly important for high-income business owners who want to quickly close their retirement gap using a tax-efficient vehicle.

What Is a Defined Benefit Plan?

How Can I Substantially Reduce My Taxes and Fund for Retirement?

How Can a Defined Benefit Plan Help Me?

When Does a Defined Benefit Plan Make Sense?

Defined Benefit Plans work best for business owners who are at least 35 years old and are willing to contribute at least $75,000 per year for five or more years. However, in many cases, business owners fund the maximum retirement value of $3.4 million in only 10 years.

We would be happy to discuss any specific situations at (480) 795-8256 or

How Much Can I Contribute to a Defined Benefit Plan?

The annual contribution is determined each year by an actuary and is based on the amount expected to fund the retirement value (up to $3.4 million for retirement at age 62). The maximum retirement value is adjusted if the plan is in existence for fewer than 10 years or for retirement at a different age.

I Already Have a Retirement Plan. Why Do I Need a Defined Benefit Plan?

The maximum annual contributions in a Defined Benefit Plan may be significantly higher than for other retirement arrangements. For example, the maximum annual contribution in a 401(k) plan is only $30,000 and the maximum annual contribution in a SEP or Profit Sharing Plan is $66,000.

If you want to contribute more than these maximums, a Defined Benefit Plan has annual maximums that may be significantly higher. In fact, Defined Benefit Plans are often paired with 401(k) and Profit Sharing Plans to increase the maximum annual contribution further.

Are Contributions Required?

Unless the plan is significantly overfunded, contributions are required each year to fund retirement benefits. The ability to make regular contributions is essential, so the plan is designed to make expected contributions affordable.

Would I Need to Provide a Benefit to My Employees?

Yes, although benefit amounts may be provided at a lower level to non-owner employees as long as certain requirements are met. In addition, employees who work fewer than 1,000 hours every year may be excluded from the plan. 

We would be happy to provide you an overview of expected owner and employee benefits based on your specific situation.

What is the Cost of Setting Up and Maintaining a Defined Benefit Plan?

The cost for setting up and maintaining a Defined Benefit is provided on a fixed-fee basis and depends on a number of factors. For a fee quote, contact us at (480) 795-8256 or at

What is the Next Step?

To learn more about how a Defined Benefit Plan can help you reduce your taxable income and save for retirement, contact Saber Pension at (480) 795-8256 or at

Frequently Asked Questions