With unfunded plan,executives may forfeit retirement benefits when a company becomes bankrupt or financially insolvent or following a change of company ownership.(Funding Status)

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With unfunded plans, executives do not have a separate pool of assets set aside for their retirement benefits. Instead, the benefits are paid out of the company's general assets. If the company becomes bankrupt or financially insolvent, or if there is a change of company ownership, the executives may forfeit some or all of their retirement benefits, as there may not be enough assets to cover all of the obligations. This is why funded plans, where assets are set aside specifically for retirement benefits, are generally considered to be more secure for executives.

With Unfunded Plan,executives May Forfeit Retirement Benefits When a Company