Which of the following describes a defined contribution plan?
A)Provides guaranteed income on retirement to plan participants.
B)Employers and employees generally may contribute to the plan.
C)Generally set up to defer income for executives and highly compensated employees but not other employees.
D)Retirement account set up to provide an individual a fixed amount of income on retirement.

Question

Quizplus · Accepted Answer

A defined contribution plan is a retirement plan in which both the employer and employee (generally) contribute to the plan. The amount of retirement income is not guaranteed, but rather depends on the performance of the investments made with the contributions.

Which of the Following Describes a Defined Contribution Plan