Defined-Benefit Plan

(redirected from Defined Benefit Pension Plan)
Also found in: Acronyms.

Defined-Benefit Plan

A retirement plan in which the retiree receives a set amount in benefits each month once he/she begins receiving benefits. That is, the benefits the retiree receives are not dependent on the performance of the portfolio in which the contributions are invested; the company sponsoring the plan assumes the entire liability. The amount of the benefit is determined according to some formula that usually accounts for the amount of contributions and the length of time the retiree worked for the company. The disadvantage to a defined-benefit plan, from the company's perspective, is the possibility that the investment portfolio will not perform as expected, forcing the company to make payments from its earnings, or, worse, to borrow money. See also: Defined-contribution plan.
References in periodicals archive ?
Employers not contributing to a multiemployer defined benefit pension plan should promote and modify existing benefit packages based on employee experience and satisfaction and assure that presentations for enrollment in retirement programs and reports of periodic performance are utilized to meaningfully inform and enthuse employees so that they take advantage of available benefits and appreciate their value--absolutely and relative to less rewarding and higher risk plans that could be more costly but deliver less certain value.
Under a defined benefit pension plan the employer bears the investment risk of the plan (i.
Nearly two-thirds of police and firefighters who participated in a defined benefit pension plan also were covered by Social Security.
The improved health of the typical US defined benefit pension plan is due largely to the year's strong equity market returns, according to Aaron Meder, UBS Global Asset Management's Head of Asset Liability Investment Solutions in the Americas.
NSA, a unit of Southwire, created a defined benefit pension plan for employees in 1970.
has subpoenaed four banks for data on the defined benefit pension plan of Aloha's machinists union, the Associated Press reported.
96-1, Application of Certain Pension Disclosure Requirements for Employers Pending Implementation of GASB Statement 27, is effective for fiscal years beginning after June 15, 1996, or as early as the date a defined benefit pension plan adopted GASB Statement no.
Controlled groups/other plans: The IRS SEP document may not be used (1) unless all members of a controlled or affiliated service group adopt the SEP, (2) if the employer currently maintains any qualified plan or (3) if the employer ever maintained a defined benefit pension plan.
In 1993, the Supreme Court held that an employer's contribution of unencumbered property to a qualified defined benefit pension plan, in satisfaction of the employer's funding obligation, was a "sale or exchange" and, therefore, a prohibited transaction (Keystone Consolidated Industries, Inc.
Journal Register Company (NYSE:JRC) today announced that, effective January 1, 2007, the Company is introducing a new retirement plan and changing its defined benefit pension plan for non-union employees.
This Advisory Opinion provides defined benefit pension plan fiduciaries with greater clarity on the consideration of liabilities and associated risks as part of prudent investment decision making.
1992), aff'g TC Memo 1990-628, that a contribution of unencumbered property by an employer to a defined benefit pension plan in satisfaction of the employer's minimum funding obligation constituted a prohibited sale or exchange under Sec.

Full browser ?