Portable Benefits

AAA

DEFINITION of 'Portable Benefits'

Benefits that have been paid into or accrued in an employer-sponsored plan and that can be transferred to a new employer's plan or to an individual who is leaving the workforce. Applies to benefits from health plans, retirement plans and most other defined-contribution plans.

Portability of benefits can be found within most 401(k) plans, 403(b) plans and health savings accounts (HSAs).


INVESTOPEDIA EXPLAINS 'Portable Benefits'

There has been a lot of recent progress in making employee benefits more portable. 401(k) and 403(b) plans can usually be rolled into a new employer's plan or to an IRA; the Health Insurance Portability and Accountability Act (HIPAA) even ensures that pre-existing medical conditions don't exclude a worker when moving from one group health plan to another.

The two main types of plans that don't have portable benefits are defined-benefit plans (such as pension plans) and company-sponsored flexible spending accounts (FSAs).


RELATED TERMS
  1. Portability

    An employee's ability or right to retain certain benefits when ...
  2. Burden Rate

    Indirect costs associated with employees, over and above gross ...
  3. 401(a) Plan

    A money-purchase retirement savings plan that is set up by an ...
  4. Group Health Insurance Plan

    An insurance plan that provides healthcare coverage to a select ...
  5. Allocated Benefits

    A type of payment that comes from a defined-benefit retirement ...
  6. Employee Savings Plan

    A pooled investment account provided by an employer that allows ...
Related Articles
  1. Find Secure And Affordable Post-Work ...
    Insurance

    Find Secure And Affordable Post-Work ...

  2. Transfer Retirement Savings When You ...
    Retirement

    Transfer Retirement Savings When You ...

  3. Health-y Savings Accounts
    Retirement

    Health-y Savings Accounts

  4. Retirement Strategies For Low Income ...
    Retirement

    Retirement Strategies For Low Income ...

comments powered by Disqus
Hot Definitions
  1. Last In, First Out - LIFO

    An asset-management and valuation method that assumes that assets produced or acquired last are the ones that are used, sold ...
  2. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  3. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  4. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  5. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  6. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
Trading Center