defined benefit pension scheme

A defined benefit pension scheme is a retirement plan where your employer guarantees you a specific income after you retire, based on factors like your salary and years of service. Essentially, the pension amount is pre-determined, offering security and predictability. The employer is responsible for fund management and ensuring there is enough money to pay these benefits. This scheme provides peace of mind, as your retirement income isn't affected by investment performance, but it also means the employer bears the investment and longevity risks.