Chartered Retirement Planning Counselor (CRPC) Practice Exam 2025 - Free CRPC Practice Questions and Study Guide

Excess benefit plans are designed to provide benefits that exceed the limits imposed by the Internal Revenue Code on qualified retirement plans. One of the distinctive characteristics of these plans is that they often provide for employer-paid benefits, meaning that the employer funds these excess benefits directly. This allows highly compensated employees or key executives to receive additional retirement benefits that are not limited by the cap set on qualified plans.

The focus on employer-paid benefits is crucial because it enables organizations to offer competitive compensation and benefits packages to attract and retain top talent. This goes beyond conventional retirement plans, which may have contribution limits, thus addressing the need for additional retirement security for higher earners.

In contrast, while fully funding at all times, availability exclusively to management, and mandatory participation are considerations related to retirement plans, they do not specifically define the unique function of excess benefit plans. The primary utility of such plans lies in the employer's willingness to provide additional benefits funded by the employer to enhance the retirement offerings for select individuals, making option C the most fitting choice.