ESOPs - An Important Part of the Retirement Plan Discussion?

A group of people in a retirement plan discussion

With the increase in the number of business owners looking to retire, watch the video below to learn how business owners can cement their legacy and save on taxes through implementing an Employee Stock Ownership Plan. (ESOP). Find out what questions to ask your 401(k) clients or prospects and how to effectively engage with them on their exit strategy. ESOPs are becoming more and more popular and now is the time to learn more about how to include them into your retirement plan practice. 

  • Kara Kidney, Business Development Director- OneAmerica
  • Jackie Salmon, ESOP National Practice Leader - OneAmerica
What is an ESOP?
  • A qualified defined contribution plan that invests primarily in company stock.
  • Similar tax, reporting, and disclosure attributes of a 401(k) plan must be in compliance with the DOL/IRS.
  • Different from 401(k)s on that transaction allowed for ESOP are no "prohibited"
  • Used to create a liquidity event and succession plan for owners while providing a powerful employee benefits

There are limited succession options available for business owners. They can close/liquidate the business, sell to an outsider, sell to foamily members and/or management, gift of stock, family limited partnership, keep taking a paycheck while retaining ownership until death, ESOP, or utilize a combination of these. 


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