Defined Contribution Scheme
It is also known as Money Purchase Scheme.
The benefits paid out to the member comprises the employer and employee contributions with interest and the total amount payable may be used to buy a pension through purchase of an annuity.
For members who would want to enhance their pension benefits when they retire or at a time they leave employment before reaching the normal retirement age, they can make more contributions. The additional contributions are known as Additional Voluntary Contributions (AVCS) and are not compulsory but optional, depending on the desire of the members. They are over and above the agreed upon contributions in the agreements.
A lump sum is paid out to members who are below normal retirement age.
Membership is not restricted to those employed on pensionable terms. Individuals employed on fixed it contracts may also become a member of the scheme.
A death benefit is payable to the member’s nominated beneficiaries if a member dies while contributing to the scheme.
Benefits are easily accessible and paid out on time.
The pension is a transferrable from one employer to another, within the Pension Scheme or outside the Pension.