Question

You are analyzing your company in order to ensure that the retirement plans of its employees best benefit both the employees and the company. You notice that two of your executives are currently 57 and 60. Of the following choices, which best fulfills your concerns about the benefits working for both employee and employer?

[A] Offering the two executives a deferred compensation plan that is non-qualified.
[B] Offering the two executives a 403(b) plan.
[C] Offering the two executives a defined benefit plan.
[D] Offering the two executives a tax-sheltered annuity.

Answer 1

Answer:

C) Offering the two executives a defined benefit plan.

Explanation:

A defined benefit plan is the best option for the two employees that are near retirement age and the company. Since those employees have worked for many years, they should have already accumulated high monthly pension benefits under a defined benefit plan.

A defined benefit plan gives the employee a specific payment once they retire.