From the course: Helping Your Employees Meet Retirement Goals
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What are company-sponsored retirement plans?
From the course: Helping Your Employees Meet Retirement Goals
What are company-sponsored retirement plans?
- If you're building a retirement program for your company or managing an existing one, understanding the basic structure of retirement programs will help you support them more effectively. There are two basic ways to deliver a retirement benefit to employees. One is through a defined benefit plan. The other is through a defined contribution plan. A defined benefit plan is set up by your company and managed by financial experts. These professionals take money contributed by both employers and employees and invest and manage the money. Upon retirement, the employee gets the money that's been put away for them as monthly income, and the money will continue until the day they die. If this type of plan sounds familiar, it's how pensions and most government retirement plans are structured. There's two huge benefits to these plans. First, they're managed by professionals. Employees don't have to worry about how much to invest or what investments to put their money into. And second, in…
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