BROWSE

DB(k) Plan

What is 'DB(k) Plan'

A retirement plan that combines some of the characteristics of a 401(k) plan with those of a defined benefit (DB) plan. Funds can be voluntarily contributed to the DB(k) plan just as they can with a 401(k) plan, with the employer retaining the option to match the funds up to a certain percentage. Upon retirement, the employer will also pay the employee a small percentage of his or her salary, which is similar to a traditional pension.


The DB(k) plan was included in the Pension Protection Act of 2006.

Explaining 'DB(k) Plan'

The DB(k) plan was designed to provide businesses with a way to attract employees, since many investors worry that their entire savings could be wiped out in a down market. Retaining the pension characteristic means that the retiree will still have a source of income, regardless of the performance of the 401(k) portion of the plan.


Further Reading


The role of amenities and quality of life in rural economic growth
onlinelibrary.wiley.com [PDF]
… 83(2) (May 2001): 352–365 Copyright 2001 American Agricultural Economics Association … As an outffow of the 1998 Resource Planning Act Assessment of Outdoor Recreation and Wilderness … and business taxes are generally deemed to be detrimental to local economic growth …

Portfolio choice and trading in a large 401 (k) planPortfolio choice and trading in a large 401 (k) plan
www.aeaweb.org [PDF]
… 83(2) (May 2001): 352–365 Copyright 2001 American Agricultural Economics Association … As an outffow of the 1998 Resource Planning Act Assessment of Outdoor Recreation and Wilderness … and business taxes are generally deemed to be detrimental to local economic growth …

Turning workers into savers? Incentives, liquidity, and choice in 401 (k) plan designTurning workers into savers? Incentives, liquidity, and choice in 401 (k) plan design
www.nber.org [PDF]
… 83(2) (May 2001): 352–365 Copyright 2001 American Agricultural Economics Association … As an outffow of the 1998 Resource Planning Act Assessment of Outdoor Recreation and Wilderness … and business taxes are generally deemed to be detrimental to local economic growth …

Are 401 (k) plans replacing other employer-provided pensions? Evidence from panel dataAre 401 (k) plans replacing other employer-provided pensions? Evidence from panel data
www.nber.org [PDF]
… 83(2) (May 2001): 352–365 Copyright 2001 American Agricultural Economics Association … As an outffow of the 1998 Resource Planning Act Assessment of Outdoor Recreation and Wilderness … and business taxes are generally deemed to be detrimental to local economic growth …

The effects of 401 (k) participation on the wealth distribution: an instrumental quantile regression analysisThe effects of 401 (k) participation on the wealth distribution: an instrumental quantile regression analysis
www.mitpressjournals.org [PDF]
… 83(2) (May 2001): 352–365 Copyright 2001 American Agricultural Economics Association … As an outffow of the 1998 Resource Planning Act Assessment of Outdoor Recreation and Wilderness … and business taxes are generally deemed to be detrimental to local economic growth …

What determines 401 (k) participation and contributionsWhat determines 401 (k) participation and contributions
heinonline.org [PDF]
… 83(2) (May 2001): 352–365 Copyright 2001 American Agricultural Economics Association … As an outffow of the 1998 Resource Planning Act Assessment of Outdoor Recreation and Wilderness … and business taxes are generally deemed to be detrimental to local economic growth …

Can 401 (k) Plans Provide Adequate Retirement Resources?Can 401 (k) Plans Provide Adequate Retirement Resources?
journals.sagepub.com [PDF]
… 83(2) (May 2001): 352–365 Copyright 2001 American Agricultural Economics Association … As an outffow of the 1998 Resource Planning Act Assessment of Outdoor Recreation and Wilderness … and business taxes are generally deemed to be detrimental to local economic growth …

401 (k) matching contributions in company stock: costs and benefits for firms and workers401 (k) matching contributions in company stock: costs and benefits for firms and workers
www.sciencedirect.com [PDF]
… 83(2) (May 2001): 352–365 Copyright 2001 American Agricultural Economics Association … As an outffow of the 1998 Resource Planning Act Assessment of Outdoor Recreation and Wilderness … and business taxes are generally deemed to be detrimental to local economic growth …

Individual decision making and risk in defined contribution plansIndividual decision making and risk in defined contribution plans
heinonline.org [PDF]
… 83(2) (May 2001): 352–365 Copyright 2001 American Agricultural Economics Association … As an outffow of the 1998 Resource Planning Act Assessment of Outdoor Recreation and Wilderness … and business taxes are generally deemed to be detrimental to local economic growth …



Q&A About DB(k) Plan


What is a DB(k) plan?

A DB(k) plan combines some of the characteristics of a 41(k) plan with those of a defined benefit (DB) plan.

How much will employees receive upon retirement from their employer?

Employees will receive small percentages of their salaries, which is similar to traditional pensions.

Why did Congress create this type of retirement plan for businesses and individuals?

To attract employees, since many investors worry that their entire savings could be wiped out in a down market. Retaining the pension characteristic means that retirees will still have sources of income, regardless if there are losses on investments or not.

What are some characteristics that the DB(k) Plan has in common with the 41(k)?

The funds can be voluntarily contributed to the DB(K), just as they can with a 41(K).

When was this type of retirement plan included in the Pension Protection Act?

The year was 26.