Arkansas Diamond Deferred Compensation Plan.

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xram
Posts: 780
Joined: Sat Sep 15, 2012 11:36 am

Arkansas Diamond Deferred Compensation Plan.

Post by xram » Mon Mar 11, 2013 6:08 pm

As a doc in Arkansas who sees Medicaid patients,I just found out today that I am eligible for this ADDITIONAL tax-advantaged space. Gotta get my employer on board!! Also .. This money is NOT subject to creditors should hospital go under.

Anybody have experience with this plan? Especially as an employed physician....not private practice.


From the website:
What is deferred compensation?

As a Medicaid provider, you are an independent contractor of the state of Arkansas and are eligible to defer a portion of your Medicaid income on a pre-tax basis. By making contributions to the State of Arkansas Diamond Deferred Compensation 457(b) Plan, commonly referred to as the Arkansas Diamond Plan, you can include Medicaid as an element of your retirement planning.

The annual dollar limit is $17,000 for calendar year 2012 and later. If you are age 50 or older, the annual dollar limit is $22,500 for calendar year 2012 and later. This deferral is in addition to any contributions made on your behalf to a qualified retirement plan established by your group or individual practice such as a 401 (k) plan, a profit sharing plan, a money purchase pension plan or a defined benefit plan. The Arkansas Diamond Plan includes a special pre-retirement catch-up provision which allows deferrals for three consecutive years equal to twice the dollar limit. The Arkansas Diamond Plan also offers a ROTH option. Participants can utilize both options during the year if they wish, but their total contribution cannot exceed their respective calendar year limit.

https://myplan.ingplans.com/einfo/plani ... 56530748e9

https://www.medicaid.state.ar.us/Intern ... q/faq.aspx
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Default User BR
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Joined: Mon Dec 17, 2007 7:32 pm

Re: Arkansas Diamond Deferred Compensation Plan.

Post by Default User BR » Tue Mar 12, 2013 12:44 pm

A Government 457 plan is a very good addition to your retirement options.


Brian

Topic Author
xram
Posts: 780
Joined: Sat Sep 15, 2012 11:36 am

Re: Arkansas Diamond Deferred Compensation Plan.

Post by xram » Tue Mar 12, 2013 2:17 pm

Default User BR wrote:A Government 457 plan is a very good addition to your retirement options.


Brian

Thanks. I am very excited about this option. It's going to take some schoomzing because nobody here at this clinic/hospital is taking advantage of this program right now......keeping fingers crossed.
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Beardog
Posts: 87
Joined: Thu Mar 22, 2007 10:38 pm
Location: Arkansas

Re: Arkansas Diamond Deferred Compensation Plan.

Post by Beardog » Wed Mar 13, 2013 8:52 pm

I have a good deal of experience with the Arkansas Diamond Plan. I have been deferring the maximum into it for about 10 years.

I am a self employed physician, in solo practice. Being 50 years old this year, I can put the maximum amount into AR Diamond. I use the index funds, and all my Arkansas Diamond plan money is in the index bond fund (very comparable to the Vanguard total bond market fund).

I read the Boglehead forum almost daily, but I seldom post. I have been a Boglehead for several years.

You will have a very hard time getting your employer to agree to letting you defer into the plan. Trust me, your "employer" has no interest in you (and no telling how many other physician employees) putting away an additional $17-23K every year that they can't get their hands on.

One of the biggest concerns that Arkansas physicians should have in becoming employed is their ability (or inability) to own a 401(k) and invest in Arkansas Diamond. At 50 years old, I have both a low cost 401(k) and Arkansas Diamond.

When it is all said and done, I can put about $50K per year in my 401(k). This year, I can put $22K into Arkansas Diamond. In addition, my wife works for me part time, and she is also 50 years old. So, we can put $22K into our 401(k) for her, as well. That is darn close to $100K tax deferred this year, with the amount adjusted upwards every year.

My friends who are employed physicians can put away a maximum of 22K per year (if they are 50 or older) into the employing hospital's crappy high fee retirement plan. Also, their spouses can't work for them, since that is against the hospital rules. So obviously, unless their spouses are employed elsewhere with a good retirement plan, they take the shaft from that standpoint, too.

If you are interested, you can contact me off forum.

I do wish you the best of luck. However, I know that the Arkansas Diamond battle is one that over 125 local physicians lost after they signed a 130 page employment contract (that very few of them read, much less comprehended). Only later did they start wondering about "little things" like their retirement. But, by then it was too late. They were just well compensated employees, nothing more. They all rolled over their small business 401(k) retirement plans into the mega-huge hospital corporation plan and were flat out refused AR Diamond participation. Now that they are all miserable, they have a 50 mile non-compete clause, and can't leave their employed positions and still stay in town. :oops:
Beardog

Chichmode
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Joined: Fri Sep 04, 2015 12:13 am

Re: Arkansas Diamond Deferred Compensation Plan.

Post by Chichmode » Fri Sep 04, 2015 12:28 am

Why are employers typically unwilling to allow employed physicians access to the Arkansas Diamond Deferred Compensation Plan? I am currently a resident who is may potentially be looking for work in Arkansas, and have been told by others that employers typically do not offer their physicians access to this plan. I just don't know why that would be the case, and what their direct benefit would be by having physicians not participate. Does it take money out of their pocket somehow? And for those who have discussed this with employers, is this something that is typically negotiable if you have NOT yet signed your first/initial contract? Thanks in advance for your input.

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