Supplemental Executive Retirement Plan - SERP

AAA

DEFINITION of 'Supplemental Executive Retirement Plan - SERP'

A non-qualified retirement plan for key company employees, such as executives, that provides benefits above and beyond those covered in other retirement plans such as IRA, 401(k) or NQDC plans. There are many different kinds of SERPs available to companies wishing to ensure their key employees are able to maintain their current standards of living in retirement.

SERPs are also known as "top hat plans".

INVESTOPEDIA EXPLAINS 'Supplemental Executive Retirement Plan - SERP'

Unlike NQDC plans, in which key employees defer compensation in order to receive it later, SERPs are entirely funded by the employer. Because of the high costs associated with funding SERPS, they are criticized by shareholder advocates and labor groups that believe some executives are overpaid for their performance.

RELATED TERMS
  1. Top Hat Plan

    A form of retirement plan available only to selected company ...
  2. Employee Stock Option - ESO

    A stock option granted to specified employees of a company. ESOs ...
  3. Employee Stock Ownership Plan - ...

    A qualified, defined contribution, employee benefit (ERISA) plan ...
  4. Golden Hello

    A signing bonus offered to a candidate from a rival company. ...
  5. Government-Sponsored Retirement ...

    A Canadian retirement plan for individuals who are not employees ...
  6. Camouflage Compensation

    Compensation that is granted to upper echelon employees, directors, ...
Related Articles
  1. Financial Footnotes: Start Reading The ...
    Fundamental Analysis

    Financial Footnotes: Start Reading The ...

  2. A New Approach To Equity Compensation ...
    Options & Futures

    A New Approach To Equity Compensation ...

  3. Putting Management Under The Microscope
    Options & Futures

    Putting Management Under The Microscope

  4. How Does A Reverse Mortgage Work?
    Retirement

    How Does A Reverse Mortgage Work?

Hot Definitions
  1. Halloween Strategy

    An investment technique in which an investor sells stocks before May 1 and refrains from reinvesting in the stock market ...
  2. Halloween Massacre

    Canada's decision to tax all income trusts domiciled in Canada. In October 2006, Canada's minister of finance, Jim Flaherty, ...
  3. Zombies

    Companies that continue to operate even though they are insolvent or near bankruptcy. Zombies often become casualties to ...
  4. Witching Hour

    The last hour of stock trading between 3pm (when the bond market closes) and 4pm EST. Witching hour is typically controlled ...
  5. October Effect

    The theory that stocks tend to decline during the month of October. The October effect is considered mainly to be a psychological ...
  6. Repurchase Agreement - Repo

    A form of short-term borrowing for dealers in government securities.
Trading Center