In this assignment, you will be given several different scenarios. You will need to type on a separate sheet of paper which plan type you think would be best for each situation and why you have chosen that plan type. Each scenario will be worth 1 point. There are nine scenarios, so you will receive 1 extra point for turning the assignment in on time. Each scenario will have only one correct answer and you may not use the same plan type for more than one scenario. The plan types that you can choose from are: a Straight Defined Benefit Plans, a Target Benefit Plans, an ESOP, a SIMPLE, a SEP, a 401(k), a 403(b), a Profit Sharing Plan, or a Money Purchase Pension Plan.

Scenario #4

A lumber mill in rural Pennsylvania owns 10,000 acres of prime forest property. They can sustainably harvest enough lumber from this acreage to provide the business with several million dollars of revenue year-in and year-out. The owner and his five sons all work at the company full-time. He also has other family members employed there as well. He and his three oldest boys have been working at the company for well over 20 years each. To this point, he has been focused on buying more and more property, but now that he has reached the age of 54, he feels that he has bought enough land for the family business to be viable for many generations. The owner has no intention of selling his interests in the business yet, but he does want to plan for his eventual retirement. He wants to consider a plan type that would enable both he and his children to receive a certain allotment for the past years of lost retirement saving. Since most of the employees are all family, he is willing to leverage the reliability of the lumber business cash flows into providing a retirement benefit. His is most interested in providing a specific level of benefit for himself and his children in retirement. What plan type is best for this potential client?