MONY Rolls Out Individual (k) Plan

September 23, 2003 ( - MONY Life Insurance Company has rolled out a new retirement solution tailored for owner-only businesses.

The MONY Individual (k) plan is offered through an integration of life insurance and annuities allowing plan owners to pay life insurance premiums with pre-tax dollars, according to a news release.   Those choices include:

  • MONY Variable Annuity
  • MONY Fixed Annuity
  • MONY Variable Universal Life
  • Interest Sensitive Whole Life products.

The MONY plan also allows individuals to squirrel away up to $40,000 annually by maximizing salary deferrals and employer’s contributions for 2003.  Participants age 50 and older can tack on an extra $2,000 to that annual contribution amount.   Administrative support for the plan will be provided by BISYS.

Sold through MONY brokers, as well as MONY career agents, independent agents, brokerage general agencies and Trusted Advisors Corp, this turnkey offering will include:

  • employer and financial advisor kits
  • sales support
  • customized marketing materials
  • product training
  • Web site content and support
  • plan installation services
  • call center services.

Solo Plans

The so-called Individual (k) plan is unique in that it is designed explicitly for owner-only businesses and businesses with part-time or seasonal employees who can be excluded from participation in traditional 401(k) plans in accordance with federal law. The product enables small-business owners to contribute significant amounts of income, in some cases more than twice as much as they are allowed under traditional small-business plan regulations.

The Economic Growth and Tax Relief Reconciliation Act (EGTRRA) of 2001 lifted many of the limits on the amount and deductibility of contributions for 401(k) plans. Prior to that, single-owner businesses were better off saving for retirement in other types of plans. However, EGTRRA effectively put 401(k) plans on an equal—and, in some cases, better—footing compared with other tax-deferred savings plans for sole proprietorships—giving life to a “new” product, the “Individual (k)” or “solo (k).”