Defined contribution plans set a specific maximum amount or percentage of compensation that may be paid into a plan.
In contrast, 401(k) plans are a type of defined contribution plan.
It may be converted into a defined contribution plan.
In a defined contribution plan, contributions are paid into an individual account for each member.
Defined contribution plans are supposed to provide a similar benefit.
Thus Congress saw no need to provide insurance protection for participants in defined contribution plans.
The first is similar to other defined contribution plans and amounts to an additional $5,500 that can be contributed as noted above.
A defined contribution plan, on the other hand, does not promise you a specific benefit amount at retirement.
The government does not guarantee benefit payments for defined contribution plans.
All such defined contribution plans must be submitted to state insurance regulators before they are sold.
