To be precise, a defined benefit plan is defined in the Internal Revenue Code as a retirement plan "other than an individual account plan." So, if the plan isn't a DC plan, it must be a DB plan. But, as noted earlier, the major determinant of a DB plan is that the benefits be "definitely determinable," generally by a specific (“defined”) formula in the plan document.
In theory, what you "know" at a given point is the benefits due, based on that formula (though that may be easier said than done).
Those benefits are generally paid based on three factors: the worker’s age, service, and compensation. Those benefits paid may be based on Social Security benefits, and may or may not be adjusted for subsequent cost-of-living adjustments, based on the terms of the plan.
In the corporate sector, these programs are insured by the Pension Benefit Guaranty Corporation (PBGC), and the costs of these plans are borne by the employer, including the need to hire actuaries and pay insurance premiums (PBGC), in addition to regular operating costs. In the public sector, these programs also may have an employee-contributory feature.
May 17, 2013
Canadian Pension Plan Assets Increase in 2013
Canadian Pension Plan Assets Increase in 2013 May 17, 2013 (PLANSPONSOR.com) – The Canadian Pension Plan (CPP) ended its fiscal year on March 31, 2013, with net assets of $183.3 billion, compared to $161.6 billion for 2012. Kevin McGuinness editors@plansponsor.com The $21.7 billion increase
May 15, 2013
Government Employees Postponing Retirement
Government Employees Postponing Retirement
May 15, 2013 (PLANSPONSOR.com) – More than one-third of state and local government employees are postponing when they retire, according to a survey.
Kevin McGuinness
editors@plansponsor.com
The annual survey, “State and Local Government Workforce: 2013
May 14, 2013
Nebraska Governor Vetoes Retirement Bill
Nebraska Governor Vetoes Retirement Bill
May 14, 2013 (PLANSPONSOR.com) – Nebraska Governor Dave Heineman vetoed a bill that deals with retirement plans for school employees, judges and state patrol officers.
Kevin McGuinness
editors@plansponsor.com
The Omaha World-Herald reported that in his
May 10, 2013
PBGC to Take Plan of Mass. Hospital
PBGC to Take Plan of Mass. Hospital
May 10, 2013 (PLANSPONSOR.com) – The Pension Benefit Guaranty Corporation (PBGC) will be taking responsibility for the pension plan of Noble Health Systems Inc.
Kevin McGuinness
editors@plansponsor.com
The pension benefits cover more than 830 current and futu