Employee Benefits Pre-Funding

Employee Benefits Shouldn’t Come at a High Cost to Your Credit Union

Oh, the cost of employee benefits. Group health in particular. The annual health insurance renewal process is always a fun time, isn’t it? How much will the premium increase this year? 10 percent? 15 percent? 25 percent!?

The basic premise behind employee benefits pre-funding is simple; invest some of your available funds into “otherwise impermissible” investments that offer higher returns than Part 703 investments and use those returns to help offset spiraling employee benefits costs.

§701.19C codifies NCUA’s longstanding position on how FCU’s can properly utilize otherwise impermissible investments, and similar rules exist for most state-chartered credit unions.

While the premise behind employee benefits pre-funding may be simple, properly administering a program requires at a minimum, a significant understanding of the regulatory environment, a specialized skill set with respect to portfolio management, and a deep understanding of GAAP (generally accepted accounting principles).

At Elite Capital, we’ve got you covered. Employee benefits pre-funding is why our firm came into existence in 2007 when we launched our flagship program, the Elite Yield Enhancement Pre-Funding Program®.

If you’re new to employee benefits pre-funding then give us a call, you’ll be glad you did. If you have an existing program, contact us and find out how Elite Capital can take your program to a whole new level.

It all starts with understanding your costs and funding limits. Click here for a free, no-obligation analysis and get a better sense of how employee benefits pre-funding could benefit your credit union.