Pioneer Flies Solo DB Plan Into the Market

May 18, 2004 ( - Pioneer Investment Management, USA Inc has launched a new defined benefit plan designed specifically for small businesses and self-employed professionals.

“The Pioneer Uni-DB is not your father’s pension plan,” said Jodie Hale, Vice President of Retirement Plans Marketing at Pioneer in announcing the firm’s new individual(k) plan.   “It is tailored and priced for small companies. Thanks to tax law changes, funding a DB plan is now a compelling opportunity for small businesses for the first time in many years.”

The Pioneer Uni-DB Plan is for professional practices with up to five employees.   Approved by the Internal Revenue Service (IRS) for these smaller firms, the Pioneer Uni-DB Plan allows business owners to make tax-deductible contributions up to $150,000 or more annually.

Prior to launching Uni-DB, Pioneer introduced an Individual(k) plan in the summer of 2001 – Pioneer Uni-K Plan.  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 (See  Black Box: Solo “Flight” ).