BANKING AFFAIRS

BANKING GENERAL KNOWLEDGE

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

Pension plan in which benefits of pension is paid in by both parties involved, such as employers and employees is classified as which of the following?

A	non-discretionary plan
B	discretionary plan
C	contributory plan
D	non-contributory plan

Explanation:

Detailed explanation-1: -Examples of defined contribution plans include 401(k) plans, 403(b) plans, employee stock ownership plans, and profit-sharing plans.

Detailed explanation-2: -A pension plan is an employee benefit that commits the employer to make regular contributions to a pool of money that is set aside in order to fund payments made to eligible employees after they retire.

Detailed explanation-3: -A defined benefit plan is commonly called a pension plan. This plan offers guaranteed. Generally, this type of pension scheme is funded by employers for its employees with retirement pay-outs as per a set formula.

Detailed explanation-4: -As the names imply, a defined-benefit plan-also commonly known as a traditional pension plan-provides a specified payment amount in retirement. A defined-contribution plan allows employees to contribute and invest in funds and other securities over time to save for retirement.

There is 1 question to complete.