Portable Benefits


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).

BREAKING DOWN '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).

  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 ...
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