Employee Benefit Funding Trusts
Competitive benefits packages not only help recruit and retain talent, but they align with the service culture of credit unions. With the rising costs of benefits today, credit unions are faced with the challenge of how to best fund their compensation plans.
A Employee Benefit Funding Trust (EBFT) is a sustainable funding strategy for employee benefits. Through Employee Benefit Funding Trusts, credit unions fund their employee and executive benefits through actively managed investment returns rather than operating income.
Employee Benefit Funding Trusts: More Benefits. More Fund.
Our credit union partners have offset 67% of their benefit costs through Employee Benefit Funding Trusts.
*Employee Benefit Funding returns as of 12/31/20
Take Advantage of the ETF Portfolio Advantage®
We tailor your Employee Benefit Funding Trusts to your needs, goals, and risk tolerance and actively manage your portfolio to reduce risk.
- We provide expertise in developing your organization’s investment policy and offer customized solutions to meet your needs.
- EBFTs target benefits like health insurance premiums, 401k contributions, pension contributions, sick/vacation time, etc.
- Our team manages over $4 billion in assets, including $700mm in Employee Benefit Funding Trusts for credit unions across the country.
- We claim compliance with Global Investment Performance Standards® (GIPS) and analyze investment risk, liquidity risk, and compliance risk.
Members Trust products are (1) Not FDIC Insured, (2) No Bank Guarantee, and (3) May Lose Value. Past performance is not indicative of future results; return comparisons are between a composite of MTC Credit Union CDA & EBFT returns and the average return on average assets as reported by the NCUA from 2013 to 2020. Composite returns are gross of management fees. For EBFTs, offset of benefit costs cited may not be representative of future benefit cost saving.
Life Insurance vs. EBFT
|General Account Life Insurance||Separate Account Life Insurance||MTC Employee Benefit Funding Trust|
|Investment Type||Generally provides minimum interest rate guarantee||Returns are generally dependent on stock and bond market returns less applicable fees||Returns are generally dependent on stock and bond market returns less applicable fees|
|Return Potential||Low – 10-year treasury-like returns||Higher||Highest – between 10-year treasury and stock market-like returns|
|Income Volatility||Low||Higher, depending on underlying investment strategy||Higher, depending on underlying investment strategy but can be managed accordingly|
EBFT me ASAP.
Contact us today to start giving more tomorrow.
Jason Ritzenthaler, CFA, CTFA
Co-Chief Investment Officer
Director, Institutional Investments