Benefit Approach to Pensions

Benefit Approach to Pensions

How benefits for a pension are calculated. The two primary benefit approaches are the accumulated benefits and the projected unit benefit. In the accumulated benefits approach, payouts are determined according to one's salary each year benefits were awarded; that is, benefits are an average of one's earnings over time. In the projected unit benefit, the payouts are based on one's salary on the date of retirement.
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