I’m just not sure if a plan is right for me. How can I decide?

You can analyze these plans in many different ways. The plans can be complex, so I will try to simplify your decision.

For most clients it boils down to the following:

1) How high is your tax bracket and how sensitive are you to taxes? If you are in a 40% tax bracket these plans make a lot more sense compared to a 20% tax bracket. Also, I have clients who will do almost anything for a tax deferral. You just have to determine where your comfort level is.

2) How much is your annual contribution and how much of the contribution is being allocated to you? If you want to do $100k plus annually and you can get 85-90% allocated to you (compared to your employees) then it may make more sense.

3) How comfortable are you to committing to a plan for a few years? These plans are permanent in nature, but you can terminate after a few years for reasonable cause. Terminating after a few years is usually not much of a problem, but you need to realize that these plans will require an annual contribution.