Providing a defined contribution retirement plan to employees shifts the investment risk from the company to the individual employee.

Question

Quizplus · Accepted Answer

With a defined contribution plan, the employer contributes a set amount to the employee's retirement account, but the actual investment and market risk is borne by the employee. This is in contrast to a defined benefit plan, where the employer bears the investment risk and promises a specific retirement benefit to the employee.

Providing a Defined Contribution Retirement Plan to Employees Shifts the Investment