What Is The Difference Between A Pension And A Retirement Plan?

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   Steve Savant

   Syndicated Financial Columnist, Host of the weekly talk show Steve Savant's Money, the Name of the Game, Scottsdale Arizona

   A pension plan is a retirement plan, generally a defined benefit plan. Most employer sponsored qualified retirement plans are now defined contribution plans where the employees can contribute pretax dollars into their retirement plan and accumulate in those accounts tax deferred. At the time of retirement distributions are taxed as ordinary income.

   Answered on August 1, 2013

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