Pension Plan Tips

Video Transcript

"This is financial adviser Patrick Munro talking about what is a money purchase pension. Normally employers offer benefits to their employees that have passed a certain area of probation. And of course one of these main benefits that's slowly loosing popularity is a pension plan. There are various types of pension plans, but the most common pension plan is a money purchase pension plan. Basically what happens there is the employee is payroll deducted and his money is placed in with the employer who buys investments on behalf of the employee and of course that becomes the pension over time. If the employee remains loyal and faithful to the employer. Normally the money purchase is done through payroll deduction and then it's placed into stock, mutual funds, things of that nature. If it's a larger company many times the employees will also place their money in company stock. So this is Patrick Munroe talking about the benefits of a money purchase pension."