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CEO lump sum payment at retirement

  • 1.  CEO lump sum payment at retirement

    Posted 15 days ago
    Hi everyone,
    I'm posting this anonymously on behalf of a CUES member:


    I've heard some CEO's received a large payout at retirement (over $500k) and I'm curious how they did this.

    • What type of cash out or retirement bonus has your CU paid out to a former CEO or plan to payout to a soon retiring CEO?
    • Was it a lump sum just payable through payroll, 401k contribution, investment broker?
    • Was the amount based on asset size?
    • What was the best option to avoid tax implications to the payee and least impactive to your CU financials?

    Thanks in advance for any assistance you can provide.

    Warm regards,

    ------------------------------
    Lisa Hochgraf
    Senior Editor
    CUES
    lisa@cues.org
    ------------------------------


  • 2.  RE: CEO lump sum payment at retirement

    Posted 15 days ago
    Edited by Mike Mombourquette 15 days ago

    Hi everyone,
    I'm posting this anonymously on behalf of a CUES member:


    I've heard some CEO's received a large payout at retirement (over $500k) and I'm curious how they did this.

    • What type of cash out or retirement bonus has your CU paid out to a former CEO or plan to payout to a soon retiring CEO?
    • Was it a lump sum just payable through payroll, 401k contribution, investment broker?
    • Was the amount based on asset size?
    • What was the best option to avoid tax implications to the payee and least impactive to your CU financials?

    Thanks in advance for any assistance you can provide.

    Warm regards,

    ------------------------------
    Lisa Hochgraf
    Senior Editor
    CUES
    lisa@cues.org
    ------------------------------


  • 3.  RE: CEO lump sum payment at retirement

    Posted 13 days ago
    ​I assume this is a 457F bonus plan.  These need to be planned years in advance.  The ones I am familiar with, the credit union purchase life insurance on the executive with a payout at retirement date or other interval as a "golden parachute or hand-cuff". 457F's are developed in coordination with the benefit firm who does all the heavy lifting in consultation with the board and the executive.  The earning of the insurance policy are used to offset the cost of the benefit to the credit union for the executive.  This is all in compliance with NCUA regs.  The amount is usually based on the executive salary not necessarily the asset size of the cu.

    ------------------------------
    David Proffitt
    President/CEO
    Alcoa Tenn FCU
    Alcoa TN
    865.380.6262
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  • 4.  RE: CEO lump sum payment at retirement

    Posted 14 days ago
    So where is the reply from Mike?​

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    Frank Hunt
    President
    Central Wisconsin CU
    Plover WI
    715.341.0520
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  • 5.  RE: CEO lump sum payment at retirement

    Posted 14 days ago
    Sorry everyone pressed wrong key


    Sent from my iPhone