Flat Benefit Formula

AAA

DEFINITION of 'Flat Benefit Formula'

A method of calculating an employer's contribution to an employee's defined benefit plan whereby the employer multiplies an employee's months of service by a predetermined flat monthly rate.

INVESTOPEDIA EXPLAINS 'Flat Benefit Formula'

There are three basic types of defined benefit plans: the flat benefit, unit benefit and variable benefit.

RELATED TERMS
  1. Benefit Allowance

    Money that a company or government agency provides to an employee ...
  2. Coinsurance Formula

    The homeowners insurance formula that determines the amount of ...
  3. Cash Balance Pension Plan

    A pension plan under which an employer credits a participant's ...
  4. Individual Retirement Account - ...

    An investing tool used by individuals to earn and earmark funds ...
  5. 401(k) Plan

    A qualified plan established by employers to which eligible employees ...
  6. Target-Benefit Plan

    A benefit plan that is similar to a defined benefit plan since ...
Related Articles
  1. Personal Finance

    Employee Benefits: How To Know What To Choose

    Starting a new job is stressful but you don't need to sweat about setting up a benefits package.
  2. Professionals

    Why Auto-Enrollment Will Save Your Retirement

    Savers need all the help they can get, even if it amounts to an offer they can't refuse. That's why the biggest improvement to 401(k)s is auto-enrollment.
  3. Professionals

    Retirement Planning Essentials for Your Clients

    You may have heard these retirement planning tips before, but has your client actually put them into action yet?
  4. Professionals

    Which Robo-Advisor is Right for You?

    Which robo-advisor is right for you? There are many factors to consider, including breadth of services, ease of use and cost.
  5. Investing Basics

    This Investment Strategy Could Be Your key To Success

    Goal-based investing seems like an obvious tactic. But many investors have only a vague idea what their goals are, much less how to achieve them.
  6. Taxes

    Before You Visit Your Tax Preparer: Do This

    The earlier you start preparing your tax records and documents, the more likely you are to have a smooth tax return experience – and all the tax benefits you're due.
  7. Entrepreneurship

    10 Tax Benefits For The Self-Employed

    Running your own business has both personal and financial perks.
  8. Professionals

    Is This the Best Advice You Can Give Your Clients?

    For all the specialized advice you could give your financial advisory clients, this one, simple tip beats them all.
  9. Professionals

    Essential Questions for a Financial Advisor

    If you're a prospective financial advisor client (or an adviser), here are some questions you should ask ... and be prepared to answer.
  10. Retirement

    Will My Pension Impact My Social Security Benefits?

    So you're eligible for a pension, and you're eligible for social security. And the question is, will that pension impact your social security benefit?

You May Also Like

Hot Definitions
  1. Subsidy

    A benefit given by the government to groups or individuals usually in the form of a cash payment or tax reduction. The subsidy ...
  2. Sunk Cost

    A cost that has already been incurred and thus cannot be recovered. A sunk cost differs from other, future costs that a business ...
  3. Technical Skills

    1. The knowledge and abilities needed to accomplish mathematical, engineering, scientific or computer-related duties, as ...
  4. Prepaid Expense

    A type of asset that arises on a balance sheet as a result of business making payments for goods and services to be received ...
  5. Gordon Growth Model

    A model for determining the intrinsic value of a stock, based on a future series of dividends that grow at a constant rate. ...
  6. Cost Accounting

    A type of accounting process that aims to capture a company's costs of production by assessing the input costs of each step ...
Trading Center