The Employee Retirement Income Security Act (ERISA) of 1974 governs most private pension and benefit plans, easing pension eligibility rules, establishing the Pension Benefit Guaranty Corporation (PBGC), and setting guidelines for managing pension funds.
A funded pension plan is a type of retirement plan where funds are currently allocated to purchase future retirement benefits, ensuring that employees receive retirement payments even if the employer is no longer in business at the time of retirement.
A funded pension scheme is a retirement plan that pays benefits to retirees from a fund that is actively invested in securities. The returns generated by this fund are distributed as pensions to its members.
