Defined contribution plans, such as a 401K, in contrast, are far riskier for the employee although they may yield higher rates of return. "There is no way to know how much the plan will ultimately give the employee upon retiring. The amount contributed is fixed, but the benefit is not" and is dependant upon the performance of the fund," although as with defined benefit and cash balance plans, there are restrictions regarding when these plans can be withdrawn (Defined contribution, 2009, Invesetopedia). The benefit ceases when the account balance is depleted, regardless of the retiree's age, personal circumstances, previous salary and position, or years of service to the company (Defined Benefit...

Defined Contribution Plans (DC), 2009).
Works Cited

Cash balance pension plan. (2009). Investopedia. Retrieved March 17, 2009 at http://www.investopedia.com/terms/c/cashbalancepensionplan.asp

Defined benefit plan. (2009). Investopedia. Retrieved March 17, 2009 at http://www.investopedia.com/terms/d/definedbenefitpensionplan.asp

Defined Benefit Plans (DB) vs. Defined Contribution Plans (DC). (2009).

Retrieved March 17, 2009 at http://www.urs.org/general/pdf/db_vs_dc.pdf

Defined contribution plan. (2009). Investopedia. Retrieved March 17, 2009 at http://www.investopedia.com/terms/d/definedcontributionplan.asp