   
|
|
Defined Contribution Plan
|
| FYI - For 2011, Dow up, Dogs of the Dow up more (double digits) |
| |
A defined contribution plan is a type of qualified retirement plan, meaning it receives favorable tax treatment. A defined contribution plan requires the employer, on behalf of the employee, to make a specified, fixed contribution into the plan. The total dollar contribution made to the defined contribution plan is based on a percentage of the employee's compensation. The money is invested by the employee according to the options offered by the defined contribution plan. Unlike a conventional defined benefit plan, the benefits of a defined contribution plan are not fixed or predetermined. At retirement, the employee's benefit depends on the performance of the investment account and the amounts contributed to the defined contribution plan. A 401(k) plan is one type of defined contribution plan. One advantage of a defined contribution plan is that, for employees who change jobs, it is often possible to take the accumulated retirement assets with them.
Rate this defined contribution plan definition...
|
|
Where is the market headed? The answer may surprise you. Find out
right now with the exclusive & Barron's recommended charts of Chart of the Day.
|
Popular Terms: inflation, FICO score, EBITDA, labor relations, option premium, 1035 exchange, 144a, deferred revenue, limit order, balance sheet, ex-dividend date, dividends payable, command economy, current ratio, phantom income, required rate of return, average price per share, real GDP, FTSE, stock split, deferred tax, diluted share, margin rate, class C shares, debt service coverage, minority interest, open position, annual return, ex-dividend, 401a, risk management, reverse mortgage, covered put, in escrow, LIBOR, implied volatility, wholly-owned subsidiary, irrevocable trust, quality assurance, stock market close, liquidity ratio, cancelled check, 1031 exchange, APR, Key Rate Duration, Zero Cost Collar, per diem, retained earnings, VIX
|
|
| |