defined contribution scheme
- defined contribution scheme
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defined contribution scheme (DC scheme) Also known as a money purchase scheme. A pension scheme where the benefits payable to an individual member are calculated by reference to contributions paid in to the scheme in respect of that member increased by the investment return achieved. At retirement the member's pension is secured by purchasing an annuity. The pension is therefore dependant on the level of contributions, investment return and the prevailing annuity rate at retirement.
Related links
Practical Law Dictionary. Glossary of UK, US and international legal terms.
www.practicallaw.com.
2010.
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defined-benefit pension scheme — DB scheme An occupational pension scheme in which the rules specify the benefits to be received on retirement and the scheme is funded accordingly. The benefits are normally calculated on a formula incorporating years of service and salary levels … Big dictionary of business and management