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I'm resurrecting this thread. Calendar year Plan has 6 months elapsed time eligibility, age 21, quarterly entry dates. Here is the participant data: date of birth is 05/15/1981. Original date of hire is 07/13/1998. hired 07/13/1998 Termed 07/31/1998 rehired 07/05/1999 Termed 08/13/1999 rehired 02/03/2003 Termed 02/07/2003 rehired 06/02/2003 Termed 06/27/2003 rehired 02/16/2004 Termed 02/20/2004 rehired 06/07/2004 Termed 06/25/2004 rehired 03/23/2007 Termed 03/28/2007 rehired 06/18/2007 Termed 07/20/2007 rehired 06/02/2008 termed 06/27/2008 rehired 06/08/2009 termed 08/14/2009 rehired 11/12/2012 Question of the hour...when did this person enter the plan?

I don't think anyone can advise you what is "best" without a detailed knowledge of your financial situation. Having said that, a couple of comments. First, since you are talking about contributions that over the next several years are likely to be at least several hundred thousand dollars, I think it is worth your while to engage the services of an independent actuary to discuss and answer your questions. Second - be very careful of advice from a person who is trying to sell a plan based upon commission-based products. The typical 1st year commission on a whole life policy is 50% or more. I'm not implying that anything unethical is proposed or going on, but there is an inherently powerful incentive for less than objective advice in such a situation.

years ago (2007) I worked on a plan that we did some preliminary testing. one individual owned exactly 5% and was deferring 15%. Based on whatever data they sent- maybe it was 9 months of comp, their projected comp was 100,000.14 I told them I don't care how they handle it, just make sure that the person's comp did not go over the 100,000, even if the person comes to work in the morning and finds 14 pennies sitting on his desk one day.