# Defined Contribution Plan

*Retirement & Benefits — Finicade finance glossary*

A defined contribution plan specifies what goes in, not what comes out — the balance at retirement depends on contributions and investment returns. The shift from defined benefit to defined contribution moved investment risk, longevity risk and the entire decumulation problem onto individuals, most of whom have no training in any of it. That transfer is the single largest change in retirement finance of the last fifty years.

**Also known as:** DC pension, money purchase plan

**Related terms:** [Pension (Defined Benefit Plan)](https://finicade.com/glossary/defined-benefit-pension), [401(k)](https://finicade.com/glossary/401k), [Target-Date Fund](https://finicade.com/glossary/target-date-fund), [Safe Withdrawal Rate](https://finicade.com/glossary/safe-withdrawal-rate), [Sequence of Returns Risk](https://finicade.com/glossary/sequence-of-returns-risk)

Source: https://finicade.com/glossary/defined-contribution-plan