Which of the following statements regarding a deferred compensation plan is CORRECT?

A) The employer purchases a whole life insurance policy, the cash value of which the employee can access only while working for the employer.
B) The employer purchases a whole life insurance policy on key employees and receives the death benefits if the employee dies before retirement.
C) The employee uses part of his current income to purchase a whole life insurance policy, the cash value of which can be accessed only while he is employed by his current employer.
D) The employee agrees to forgo part of his current income until a specified future date, typically retirement, and may use life insurance as the funding vehicle for the plan."

Ans: D) The employee agrees to forgo part of his current income until a specified future date, typically retirement, and may use life insurance as the funding vehicle for the plan."