A pension plan that specifies the amount of annual contributions that the plan sponsor will make on behalf of a plan participant. A defined contribution plan does not guarantee a specific amount of retirement benefits. A participant's benefits at retirement are based on the amount that has been contributed to the participant's account, plus investment earnings. Contrast with defined benefit pension plan.----------[ Back
A pension plan that provides a pension based on the contributions made by the plan member and the employer and the interest earned on those contributions. (See Defined Benefit Pension Plan)
A retirement plan that does not specify the amount that a retiree will receive. Rather, the employer's obligation is to contribute a specific amount into a fund to be used for payments to retirees. To Top
A pension plan under which the employee and the employer make set annual contributions based on the employee's earnings to an account.
A registered pension plan that does not promise a specified benefit at retirement, but which depends on the contributions made and the earnings of the underlying investments in which you choose to invest your, and any company, contributions.
A type of pension where a worker and/or worker's employer contributes to an account in the worker's name and the amount received at retirement is based on the amount contributed and investment gains and losses. There is no formula to calculate future benefits. Defined contribution plans are used increasingly by employers instead of defined benefit.
A plan where contributions by employees and the employer are fixed and the benefits depend on the contributions and their earnings.
A plan under which employer contributions and, if applicable, employee contributions are individually allocated to the credit of the employees and provide whatever pension the accumulated contributions and investment earnings will buy at retirement. The amount of contributions is usually determined by a specific formula.
A pension plan that describes the annual contribution the employer will deposit into the plan on behalf of each plan participant. See also defined benefit pension plan.
A pension plan that describes the plan sponsor's annual contribution to the plan on behalf of each plan participant. At retirement, the amount of a participant's benefit is calculated based on the accumulated value of contributions made by, or on behalf of, the participant. Also known as money purchase plan. Contrast with defined benefit pension plan.
Specifies how much participants will pay before retirement, but does not specify how much participants receive when they retire (unlike a defined benefit plan). Employers may or may not contribute.
A pension plan having terms that specify how contributions to a plan member's account are to be determined, rather than the amount of retirement income the member is to receive. The amounts received by a member will depend only on the amount contributed to the member's account, earnings on investments of those contributions, and forfeitures of contributions made for other members that may be allocated to the member's account.
a registered pension plan that does not promise an employee a specified benefit upon retirement. Benefits depend on the performance of investments made with contributions to the plan.
