defined-contribution pension plan

Defined Contribution Plan

A retirement plan in which the employee and/or employer contribute a set dollar amount each month. The benefits of a defined contribution plan are not set, and depend upon how well the contributions are invested before the pensioner starts to make withdrawals. The disadvantage of a defined contribution plan is the possibility that the investments will not perform as well as expected, giving the pensioner a less secure retirement. The advantage is that the pensioner, while still making contributions, has the ability to determine how the contributions are invested, at least to a certain extent. See also: 401(k).

defined-contribution pension plan

A pension plan in which an employer's periodic payments into the plan, rather than eventual retirement benefits to employees, are specified. For example, a defined-contribution pension plan may require an employer to contribute 5% of its employees' gross pay into a fund with contributions earmarked for each employee upon retirement.
References in periodicals archive ?
This is what a defined-contribution pension plan resolves.
Replace the current annual tax-deferred saving limits for defined-contribution pension plan participants and RRSP savers with more generous regimes: either index unused contribution room for inflation or, more farsightedly, establish an inflation-indexed lifetime tax-deferred savings limit that will permit all savers to achieve pension wealth equal to that of participants in relatively comprehensive defined-benefit plans.
In 2011, Canada Post tried to force CUPW members into accepting a defined-contribution pension plan for new hires.
In addition, the authors indicate that workers were more likely to reenter the workforce after retirement if they were younger, were in better health, or had a defined-contribution pension plan.
The Roth 401(k) is a feature that can be added to a new or existing company-sponsored defined-contribution pension plan, including traditional 401(k)s, safe-harbor 401(k)s, and 403(b) tax-sheltered annuities.
The losses resulted from a change in Japanese accounting standards regarding fixed assets and Nissan's introduction of a defined-contribution pension plan, it said.
It also upheld the creation of a defined-contribution pension plan, similar to the 401(k) plans that have gained favor with private employers, for PERS-covered employees hired after August 2003.
The award adopts the new enhanced defined-contribution pension plan for new employees and provides current employees the choice--the same as for some other work groups and management--to move into the same enhanced defined-contribution plan or remain in their existing defined-benefit plan.
The airline and the pilots' union previously agreed to a new, defined-contribution pension plan that will replace the old defined-benefits plan.
This structure mandates that every (formal sector) worker pay 10 percent of earnings into a privately administered defined-contribution pension plan.
The award adopts the new enhanced defined-contribution pension plan for new employees and provides current employees the choice -- the same as for some other work groups and management -- to move into the same enhanced defined-contribution plan or remain in their existing defined-benefit plan.
Creating personal savings accounts or private accounts within the Social Security system would change it from a pay-as-you-go social insurance program to a hybrid with a defined-contribution pension plan component.