Cafeteria Plan

AAA

DEFINITION of 'Cafeteria Plan'

An employee benefit plan that allows staff to choose from a variety of benefits to formulate a plan that best suits their needs. Cafeteria plan options may include health and accident insurance, cash benefits, tax advantages and/or retirement plan contributions.

Also known as "cafeteria employee benefit plan" or "flexible benefit plan".

INVESTOPEDIA EXPLAINS 'Cafeteria Plan'

Similar to a cafeteria where individuals select their food of choice, employees may choose benefits of their choice. These plans become more useful as diversity within workforces continues to grow. For example, the benefit needs of young families may differ greatly from those of a single person.

RELATED TERMS
  1. IRS Publication 15-B - Employer's ...

    A document published by the Internal Revenue Service that provides ...
  2. Accident And Health Benefits

    Fringe benefits provided to employees for sickness, accidental ...
  3. Target-Benefit Plan

    A benefit plan that is similar to a defined benefit plan since ...
  4. Qualified Retirement Plan

    A plan that meets requirements of the Internal Revenue Code and ...
  5. Defined-Benefit Plan

    An employer-sponsored retirement plan where employee benefits ...
  6. Leveraged Employee Stock Ownership ...

    An equity compensation system in which the sponsoring company ...
Related Articles
  1. Retirement

    Job Hunting: Higher Pay Vs. Better Benefits

  2. Retirement

    Healthcare FSAs Increase Your Personal ...

  3. Entrepreneurship

    401(k) Plans For The Small Business ...

  4. Entrepreneurship

    Plans The Small-Business Owner Can Establish

Hot Definitions
  1. Capitulation

    When investors give up any previous gains in stock price by selling equities in an effort to get out of the market and into ...
  2. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  3. Conduit Issuer

    An organization, usually a government agency, that issues municipal securities to raise capital for revenue-generating projects ...
  4. Financing Entity

    The party in a financing arrangement that provides money, property, or another asset to an intermediate entity or financed ...
  5. Hyperinflation

    Extremely rapid or out of control inflation. There is no precise numerical definition to hyperinflation. Hyperinflation is ...
  6. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
Trading Center