Providing retirement security to employees.
Defined benefit plans provide a fixed benefit for employees at retirement, based on salary and length of service. Employers can generally contribute (and therefore deduct) more each year than in defined contribution plans. Alerus consultants can help determine the best plan for your situation and employees.
A defined benefit plan does not have individual accounts, all plan assets are pooled. They don’t maintain account balances to reflect participant-accrued benefits. Benefits are determined by an actuary, based on a formula stated in the plan document, which generally takes compensation and length of service into consideration.