Under a target benefit plan
, there are fixed contribution rates and targeted future pension benefits; however, the targeted amount is not guaranteed (Steele, 2016).
Aon Hewitt is releasing its 2nd Guide, Unpacking the Target Benefit Plan
: Finding the Right Benefit/Funding Balance.
Providing cost certainty to target benefit plan
sponsors appeals to them as well as to union participants.
Types Of Qualifier Retirement Plans Defined Contribution Defined Benefit page page Pension Money Purchase 390 Defined Benefit 391 Pension Plan Pension Plan Target Benefit Plan
390 Cash Balance 392 Pension Plan 412(i) Plan 393 Profit Profit Sharing Plan 394 n/a Sharing 401(k) Plan 395 Stock Bonus Plan 397 ESOP 398 Age-Weighted Profit 399 Sharing Plan Saving/Thrift Plan 400 Money Purchase Pension Plans
Generally, a target benefit plan
will be deemed to meet the "nondiscrimination in amount" requirement if: (1) it satisfies uniformity requirements with respect to normal retirement age and allocation formula (Social Security retirement age will be treated as a uniform retirement age; (1) (2) it provides a stated benefit formula that complies with one of the defined benefit plan safe harbors that uses the fractional accrual rule; (3) employer contributions are determined under an individual level premium funding method specified in the regulations, based on an employee's stated benefit and "theoretical reserve"; (4) employee contributions (if any) are not used to fund the stated benefit; and (5) the stated benefit formula satisfies Treas.
* If a target benefit plan
contains a target formula, such as 30 percent of compensation, that is identical to the benefit formula in a defined benefit plan,
A target benefit plan
is a type of money purchase plan (see above).
One was a 401 (K) and the other was a target benefit plan
A target benefit plan
is a money purchase pension plan under which contributions to an employee's account are determined by reference to the amounts necessary to fund the employee's stated benefit under the plan.
Types Of Qualified Retirement Plans * Defined Contribution Defined Benefit Pension Money Purchase Pension Defined Benefit Pension Plan  Plan  Target Benefit Plan
 Cash Balance Pension Plan  412 (i) Plan  Profit Profit Sharing Plan  Sharing 401(k) Plan  Stock Bonus Plan  n/a ESOP  Age-Weighted Profit Sharing Plan  Savings/Thrift Plan  * Numbers in brackets  indicate page numbers.
Types Of Qualified Retirement Plans Defined Contribution Defined Benefit page page Pension Money Purchase 390 Defined Benefit 391 Pension Plan Pension Plan Target Benefit Plan
390 Cash Balance 392 Pension Plan 412(i) Plan 393 page Profit Profit Sharing Plan 394 Sharing 401(k) Plan 395 Stock Bonus Plan 397 ESOP 398 n/a Age-Weighted Profit 399 Sharing Plan Saving/Thrift Plan 400 Qualified Plans Checklist Element Limitations Eligibility to Also referred to as "participation participate requirements," these are the minimum frequently.
The target benefit plan
is essentially a hybrid plan.