Cash Balance Plans
A Smarter Retirement Strategy for Business Owners and High Earners
At FBS Securities, we specialize in designing advanced retirement strategies that go beyond the basics of a 401(k) or IRA. One of the most powerful tools available to business owners and high earners is the Cash Balance Plan. This unique retirement structure combines the high contribution limits of defined benefit pensions with the flexibility of defined contribution plans, allowing you to accelerate your savings, reduce taxable income, and secure a strong financial future.
As a fiduciary Registered Investment Advisor (RIA), FBS Securities delivers boutique retirement and investment solutions tailored to your needs. We don’t believe in one-size-fits-all strategies. Instead, we put in place wealth strategies built for business owners and high earners, ensuring every recommendation is in your best interest.
What Is a Cash Balance Plan?
A Cash Balance Plan is a type of defined benefit pension plan that looks and feels like a 401(k). Unlike traditional pensions, which promise a specific income stream in retirement, a Cash Balance Plan credits participants annually with:
- A pay credit (a percentage of compensation or a fixed dollar amount).
- An interest credit (either a fixed rate or a variable rate tied to an index).
Over time, the plan balance grows with contributions and interest, giving participants a clear, account-style value that can be rolled over into an IRA at retirement.
What Is a Cash Balance Plan?
Cash Balance Plans have become increasingly popular among small business owners, professional practices, and high earners. The main reasons include:
- Higher Contribution Limits
Unlike 401(k)s or SIMPLE IRAs, Cash Balance Plans allow significantly larger annual contributions—sometimes in excess of $200,000 per year depending on age and income. This makes them ideal for high earners looking to maximize retirement savings quickly.
- Major Tax Advantages
Contributions to a Cash Balance Plan are tax-deductible for the business and reduce taxable income for the owner. This powerful combination lowers current tax liability while growing retirement wealth.
- Flexible for Businesses of All Sizes
Whether you run a professional practice with a few employees or a larger company, Cash Balance Plans can be tailored to your structure. Employers have flexibility in setting contribution formulas, often pairing them with a 401(k) for optimal benefits.
- Employee Retention Tool
Offering a Cash Balance Plan signals long-term commitment to employees, making your business more competitive in attracting and retaining top talent.
- Accelerated Retirement Savings
For entrepreneurs or professionals who started saving later in life, a Cash Balance Plan provides the opportunity to “catch up” with large contributions in a relatively short period of time.
Who Should Consider a Cash Balance Plan?
Cash Balance Plans are not for everyone, but they are especially effective for:
- Business Owners seeking higher tax deductions and retirement savings.
- Doctors, Lawyers, and Professional Practices with consistent, high annual income.
- Entrepreneurs looking to attract and retain employees while maximizing their own savings.
- High Earners who have already maxed out their 401(k) or IRA contributions.
If your income exceeds six figures and you want to shelter more from taxes while building long-term wealth, a Cash Balance Plan may be the perfect fit.
Your Fiduciary Partner
FBS Securities
When implementing a Cash Balance Plan, it’s critical to work with experts who understand both the technical structure and long-term implications. At FBS Securities, we provide:
- Fiduciary Guidance – As a fiduciary RIA, we are legally bound to act in your best interest.
- Customized Plan Design – Every business is unique; we build plans tailored to your income, employee structure, and long-term goals.
- Tax-Efficient Strategies – We coordinate with tax professionals to ensure maximum deductions and compliance.
- Ongoing Plan Management – From setup to annual administration, we guide you every step of the way.
- Boutique Service – Unlike large institutions, we deliver high-touch, personalized support.
With decades of combined experience, our team ensures your Cash Balance Plan is not just set up correctly but managed for long-term success.
Cash Balance Plans Across Texas
We proudly offer Cash Balance Plans and advanced retirement strategies for business owners and professionals across Texas, including:
- Westlake
- Hunters Creek Village
- Piney Point Village
- Highland Park
- West Village
- Bunker Hill Village
- West University Place
- Frisco
- Plano
- Allen
- McKinney
Wherever you’re located in Texas, our team is here to design and implement a strategy that secures your financial future.
Why Business Owners Trust FBS Securities
Choosing a Cash Balance Plan is a major decision. Business owners and high earners trust FBS Securities because we combine fiduciary responsibility with boutique expertise. Our clients value:
- Transparency – No hidden agendas, only advice aligned with your goals.
- Innovation – Advanced retirement plan structures designed for today’s high earners.
- Experience – A track record of helping Texas business owners build wealth.
- Accessibility – Local support and availability for face-to-face consultations.
We are not just advisors, we are your partners in building and protecting your wealth.
Start Your Cash Balance Plan Today
The earlier you act, the greater the benefits. A Cash Balance Plan can transform your tax strategy, accelerate your savings, and provide peace of mind for your retirement.
Consult with us today: 214-307-4320
Visit our office: 3900 S Stonebridge Dr., Suite 1104, McKinney, TX 75070.
At FBS Securities, we put in place wealth strategies built for business owners and high earners. Let us help you design a retirement plan that goes beyond ordinary savings—because your future deserves extraordinary planning.
FAQ
Most frequent questions and answers
A Cash Balance Plan is technically a pension plan, but it looks and feels a bit like a 401(k). Every year, the business commits to putting money into the plan for employees, and that money grows with a promised rate of return (usually a conservative percentage set by the plan). The big difference? The employer carries the investment risk and guarantees the benefit, unlike a 401(k), where the employee decides how to invest and carries all the market ups and downs.
In short:
- Cash Balance Plan = employer-driven, guaranteed benefit.
- 401(k) = employee-driven; investment results are not guaranteed.
This is where Cash Balance Plans shine. In 2025:
- The 401(k) cap is about $77,500 (including profit sharing and catch-up).
- With a Cash Balance Plan, older high-income owners may set aside well over $300,000 each year, sometimes closer to $350,000, depending on age and income.
So while a 401(k) helps, a Cash Balance Plan can multiply your retirement savings power by 4–5x.
Every dollar a business puts into a Cash Balance Plan is a tax-deductible business expense. That means:
- The company lowers its taxable income.
- The money grows tax-deferred until retirement.
- High-earning owners can move hundreds of thousands into the plan each year, avoiding paying today’s high income tax rates.
This makes it one of the most powerful tax-saving tools available to profitable businesses.
Cash Balance Plans work best for small to mid-sized businesses with steady profits, especially when the owners are in their 40s, 50s, or 60s and want to speed up retirement savings.
Industries that commonly use them include:
- Law firms
- Medical practices
- Accounting and consulting firms
- Other professional service companies
If you can commit to contributions for a few years, this plan is usually a great fit.
Professional firms often have a few high-earning partners and a team of employees. A Cash Balance Plan allows the firm to put away large amounts for the partners, while still giving employees a fair contribution to meet IRS rules.
It’s a win-win: partners build wealth fast, and staff benefit from employer contributions. Many firms also pair a Cash Balance Plan with a 401(k) so that partners can max out both.
Cash Balance Plans require professional design and ongoing oversight.
- Setup costs typically range from $3,000 to $5,000.
- Annual administration costs (for actuarial services, compliance, and filings) typically start around the same range.
For most firms saving six figures in taxes each year, the fees are a small price compared to the benefit.