What Are Some Advantages Offered By Defined Benefit Plans?

  • Completely tax deductible.

  • Defined benefit plans can be a major source of retirement income. They’re generally designed to replace a certain percentage (e.g., 70 percent) of your pre retirement income when combined with Social Security.

  • Benefits do not hinge on the performance of underlying investments, so you know exactly ahead of time how much you can expect to receive at retirement.

  • Most benefits are insured up to a certain annual maximum by the federal government through the Pension Benefit Guaranty Corporation (PBGC).

  • Fully protected from creditors and predators.