Defined Benefit Plans

Defined benefit plans, also known as defined contribution plans, offer both employees and the companies they work for clear and simple terms of how much the employee will receive upon retiring from work. Based on a certain set of calculations regarding the specified input – or contribution – of the employer and the employee, this plan provides the guarantee of a basic post retirement payout. One of the major advantages to the employer when choosing this type of retirement savings plan is the high level of contribution allowed as oppose to other employee pension options. It is important to understand that the more the employer is deducting from the employees salary, the better the tax, workmen’s comp and other coverage rates are. Still, however, the number of companies enrolled in this type of retirement savings is declining due to the high level of processing involved in many of the plans offered. Inevitably, the plans need to work through many complexities. Employees, however, continue to find these options beneficial. For the human resource specialist, these provide the key to offering benefits like early retirement. What’s more is that this can be used in conjunction with other retirement plans, providing more flexibility for both the employer and the employee.

Employee Benefits Administration
Offers a stunning overview of the role of the Human Resource professional in administering employee benefits. Every manager in charge of benefits administration should visit this website. Highly recommended.
http://www.benefits-administration.org/