This post first appeared on the National Retirement Planning Coalition website.
For most employees, one of their largest retirement assets is an employer-provided retirement plan. Therefore, knowing the benefits that your employer provides is critical. Almost everyone has heard of 401(k) plans but there are several different types of retirement plans that employers can and do offer.
In the publication, Saving for the Future: Profiles of Current Business Practices, the Chamber highlights the different types of retirement plans that employers offer and why they do so. The report highlights employers with 25 employees up to over 300,000 employees. The types of plans discussed included profit-sharing plans, cash balance plans, deferred compensation plans, and ESOPs. The accompanying benefits to the plans include Roth accounts, matching contributions, auto enrollment, auto escalation, and financial education.
Not all workers are the same; therefore not every plan design will work for every worker. One of the great successes of the private retirement system has been the ability of employers to implement new plan designs to accommodate changing demographics and evolving workforce needs. By providing these plans and benefits, employers are ensuring a financially sound future for their employees. Therefore, knowing what type of retirement plan your employer may provide and any attendant benefits is a critical part of managing retirement assets.
For more information, visit the US Chamber.
About the authors
Aliya Wong was the Executive Director of Retirement Policy at the United States Chamber of Commerce.