when combined with a 401 k plan cash balance employer contributions for rank and file employees usually amount to roughly 6 9 of pay compared with the 4 7 contributions that are typical of 401 k plans only 5
participants receive an annual interest credit this credit may be set at a fixed rate such as 5 or a variable rate such as the 30 year treasury rate at retirement participants can take an annuity based on their account balance or a lump sum which can then be rolled into an ira or another employer s plan 1cash balance pension plans are often more expensive for the employer to administer than traditional employer sponsored retirement savings plans like the 401 k that s because these pension plans require certification to ensure they re adequately funded the types of fees and amounts for each can vary but cash plans tend to have higher startup costs annual administration charges and relatively high management fees 