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CASH BALANCE PLAN

401(k) math can really add up.

A standard 401(k) lets you shelter up to $72,000 per year in 2026. That’s meaningful — but for high-income business owners, it often isn’t enough to offset the tax liability on a strong year. A Cash Balance plan changes the math.

By adding a Cash Balance plan alongside your 401(k), eligible business owners can shelter $100,000 to $300,000 or more annually in tax-deductible, tax-deferred contributions — depending on age, income, and plan design. 401GO builds and administers Cash Balance plans with the same integrated, low-friction platform you’d use for any other plan type.
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How a Cash Balance Plan Works 

A Cash Balance plan is a defined benefit plan — technically a pension — but designed to look and feel more like a 401(k). Instead of promising a specific monthly payment at retirement, it credits each participant’s account with a pay credit (typically a percentage of compensation) and an interest credit (usually a fixed rate of 4–5%) each year.
The employer bears the investment risk, not the participant. And contributions are actuarially determined, which means the older you are and the higher your income, the larger the deductible contribution you can make.
For a physician, attorney, partner, or business owner in their 50s with substantial income, the annual tax-deductible contribution can reach $200,000–$300,000 — far exceeding anything available in a defined contribution plan alone.

The Real Advantage: Pairing Cash Balance with Your 401(k)

Most business owners who adopt Cash Balance plans run them alongside a 401(k) or Safe Harbor 401(k). The combination unlocks the full range of available tax-deferred savings:
  • $24,500 in employee deferrals through the 401(k) (2026 limit)
  • Up to 25% of compensation in 401(k) profit-sharing contributions
  • $100,000–$300,000+ in Cash Balance contributions, depending on age and income
The total result: a multi-six-figure annual tax deduction for business owners who structure their plan design correctly. 401GO has the actuarial capability to design and administer this combination in a single integrated system.

The 401(k) is the floor, not the ceiling. A Cash Balance plan is what high-income owners use when they're ready to actually catch up.

Who Cash Balance Plans Are Built For

Professional service firms

Medical practices, law firms, CPA firms, consulting groups, and financial advisory practices are the most common Cash Balance adopters — because the plan design rewards high-income owners and long-tenured professionals more than rank-and-file employees.

Business owners with stable, predictable income

Because Cash Balance contributions are actuarially required each year, businesses with highly variable revenue need to plan carefully. The plan works best for owners with consistent income who can commit to annual contributions reliably.

Owners approaching retirement who need to catch up

The contribution amounts available under a Cash Balance plan increase with age. A 55-year-old business owner can shelter significantly more than a 40-year-old with the same income. For owners who started saving late and want to accelerate, Cash Balance is often the most powerful tool available.

Practices with few employees or owner-heavy compensation structures

The employer contributes for all eligible employees — but the plan design can be structured to target larger credits to owners and highly compensated employees while meeting IRS requirements for rank-and-file participants.

401GO Cash Balance: What’s Included

401GO covers the full range of retirement needs so you can say yes to the right plan for you.

In-house actuarial engine, no third-party coordination.

Plan document creation
and ongoing maintenance

Annual actuarial valuations and contribution calculations

ERISA compliance, IRS filings, and Form 5500 support

Unified 401(k) and Safe Harbor administration

Dedicated support contact for the plan sponsor and participants

FREQUENTLY ASKED QUESTIONS

Questions? We’ve got answers.

Honest answers about how the platform works, what it costs, and where it fits.
How much can I contribute to a Cash Balance plan in 2026?

Contribution limits for Cash Balance plans are actuarially determined based on age, income, and plan design — so there’s no single universal limit the way there is for a 401(k). For most high-income owners in their 50s, annual contributions in the $150,000–$300,000 range are common. For owners in their 60s, limits can be even higher. The only way to know your specific number is an actuarial calculation — our team can provide an estimate.

Yes, and most business owners who adopt Cash Balance run both simultaneously. The combination maximizes tax-deductible contributions: 401(k) employee deferrals and profit-sharing on one side, Cash Balance contributions on the other. 401GO administers both in one integrated platform.
This is the most important risk to understand before adopting a Cash Balance plan. Required contributions are actuarially determined and largely fixed, regardless of business performance. Plans can be amended or terminated if circumstances change, but that involves its own costs and timing constraints. Cash Balance works best for businesses with stable, predictable income. We’ll help you evaluate fit before you commit.
Yes. 401GO has an integrated actuarial calculation engine — you’re not coordinating with a separate actuarial firm. Plan design, annual valuations, contribution calculations, and compliance are all handled within 401GO’s platform.

Not the right fit?
Explore the full 401GO portfolio.

401GO offers a full range of retirement plan types. If you’re not sure where to start, our team will help you find the right structure for your business size, goals, and budget.

Standard 401(k)

the core offering, built for SMBs

Safe Harbor 401(k)

simplified compliance for employers who want it

Starter 401(k)

for businesses just getting started

Solo 401(k)

for owner-only businesses

ERISA 403(b)

purpose-built for tax-exempt organizations

Traditional IRA

individual retirement access

Cash Balance

for businesses with more complex planning needs

FUTURES BUILT HERE

You’ve Earned the Income. Now Protect More of It.

A Cash Balance plan isn’t for everyone — but for the right business owner, it’s the single most powerful tax-deferred savings vehicle available. Let’s run the numbers for your situation. 
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