Common or Frequently used Formulas

[K-t-F]

When designing a plan, do many of you use a match formula more often than others? Recommend one over another? (I realize there are certain variables that dictate what a plan's formula should or could be) Have you found certain formulas (besides SH formulas) are better with regards to passing non discrimination testing? Finally, what is a good source for plan design?

Thanks!

[Blinky the 3-eyed Fish]

To answer your question about a match formula that will satisfy nondiscrimination best, then logically it depends on the level your NHCE's are deferring versus your HCE's. If it's 5% and 7%, respectively, then you are probably okay with a formula that considers deferrals up to 4% of compensation, but might have a failing test if it's up to 7% of compensation. Also, if your ADP test passes each year with flying colors you will have room to shift some dollars to the ACP test and you can have a higher % matching formula. Just do the math and know it will vary by client.

In asking what is a good source for plan design, other than overall knowledge, I find that seminars provide the best information. ASPA's are always good ones and they have them all over.