Defined contribution pension scheme

(DC). A pension scheme where benefits are based on how much money has been paid into the scheme and the investment returns earned, a significant part of the sum achieved often being invested in an annuity at market rates at or soon after retirement. Such schemes are by definition funded.

Also known as money purchase schemes.

See also

• Annual allowance
• Defined benefit pension scheme
• Occupational pension scheme
• Stakeholder pension scheme