By Dr. Jim Dahle, WCI Founder

More and more physicians are being offered deferred compensation plans at their workplace. These often have alphabet-soup names and numbers attached to them, making the situation even more confusing. Plenty of doctors don’t even know how a commonplace 401(k) or 403(b) works, so when their employer mentions a 409(a) plan or similar, it shouldn’t be surprising that their eyes glaze over.

This post will explain how to think about non-qualified deferred compensation plans while discussing some of their specifics.

 

What Is Deferred Compensation?

A deferred compensation plan is simply a plan that allows an employee to decide to be paid in a later year instead of the current year.

Why would anyone want to do that? There are two reasons. The main one is simply that they hope to have a lower marginal tax rate in a future year when they

Keep reading this article on The White Coat Investor.

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