Contributor: Kelly Durante
According to InvestorWords.com, a defined contribution plan is “A company retirement plan, such as a 401(k) plan or 403(b) plan, in which the employee elects to defer some amount of his/her salary into the plan and bears the investment risk.” While there are many other sources for this definition, I chose this one for a reason. The primary purpose for participating in a defined contribution plan is for participants to save for their own retirement. While I sometimes understand people need to be protected from themselves, participants should be responsible for bearing the investment risk, rather than the plan. Plenty of rules and regulations are already in place to protect the interests of plan participants.... read more