Many California workers have very little personal savings, and many others have not yet begun to plan for retirement. Fortunately, workers of all experience levels and ages can begin to save for their retirement years. Continually evolving economic conditions and pension plan trends are having an impact on the way American workers and employers are approaching retirement savings. That is why it can be helpful to have a general understanding of retirement options and benefits.
According to the American Institute for Economic Research, close to 85 percent of workers across the country had a defined contribution plan like a 401(k) in 2013. 30 years ago, that number stood at a little less than 40 percent. In 1983, the vast majority of American workers maintained a defined benefit pension plan. In order to appreciate the significance of the shift in plan types over the years, it is necessary to understand the similarities and differences between the two.