Pension Plans

Question 1

Defined Benefit Plan

Answer 1

Defined benefit plans also are known as pension plans. Employers sponsor defined benefit plans and promise the plan’s investments will provide you with a specified monthly benefit at retirement. The employer bears the investment risks.

Question 2

Employee Retirement Income Security Act (ERISA)

Answer 2

The Employee Retirement Income Security Act of 1974, which is administered by the U.S. Department of Labor. ERISA does not require employers to offer a pension plan. But it does require employers who do offer them to meet certain minimum standards.

Question 3

Pension

Answer 3

See Defined Benefit Plan