Deferred compensation plans have become an integral way to save for retirement. They typically come in two general forms. The first is a qualified deferred compensation plan that is governed by ERISA rules, which include the more familiar 401(k) and 403(b) plans. The second is less common and technically known as a non-qualified deferred compensation plan (NQDC), also known as IRS section 409A plans or golden handcuffs. Although NQDC plans are less familiar than qualified plans, they have become increasingly common as an executive perk due to their potentially amazing tax benefits and their ability to help companies retain key employees. In this article, I’ll be breaking down the non-qualified deferred compensation plan to help you better understand what they are, how they work, and if participating makes sense for you. READ MORE