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.

BREAKING DOWN 'Flat Benefit Formula'

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

  1. Unit Benefit Formula

    A method of calculating an employer's contribution to an employee's ...
  2. Defined-Benefit Plan

    A defined-benefit plan is an employer-sponsored retirement plan ...
  3. Employee Contribution Plan

    An employee contribution plan is an employer-sponsored savings ...
  4. Withdrawal Benefits

    The rights of an employee who has a qualified pension plan to ...
  5. Target-Benefit Plan

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

    A qualified retirement plan meets the requirements of Internal ...
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