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Deferred compensation is a benefit primarily available to corporate executives, as discussed by Michelle Smallenberger from Financial Design Studio. The tutorial covers several key aspects, including what deferred compensation is, optimal timing for its use, tax considerations, and important decisions to make. Deferred compensation involves deferring income earned today to a future date, which can lead to tax savings. For instance, individuals in a high tax bracket, like 37%, may defer income to a period when they expect to be in a lower bracket, such as 24%. Additionally, the pros and cons of utilizing this benefit and its impact on financial planning are also addressed.
