What types of pension plans are there?
There are many different types of pensions but they tend to be distinguished in two major ways: final salary pensions or defined contribution schemes.
A final salary pension, also known as a defined benefit scheme, are pensions largely funded by employers, though staff may also have to pay into them.
With these pensions, you receive a percentage of your final pre-retirement salary, or when leaving that firm, as an annual income.
A defined contribution scheme, also known as a money purchase pension, is when the money you put into your pension plan is invested and what you have at retirement depends on how those investments perform.