Understanding Your Defined-Benefit Plan

ARTICLE | September 19, 2025

Defined-benefit plans have long been regarded as a cornerstone of retirement security. By promising a specific monthly benefit, typically based on years of service and salary levels, these plans can offer predictability that many other retirement vehicles lack. However, a combination of market swings, shifting corporate priorities, and changes in interest rates can put pressure on these plans. As funding gaps appear, employers must evaluate whether to dedicate more cash to fulfill their obligations or explore other approaches to control costs. Understanding how these plans work, how they are affected by economic conditions, and what steps you can take to protect your future income are all critical to ensuring a comfortable retirement.

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