What Is A Deferred Compensation Plan. With deferred compensation plans, employees can choose when to receive distributions. Deferred compensation is an arrangement in which a portion of an employee's income is paid out at a later date after which the income was earned.
Deferred compensation can exist in many forms What is Deferred Compensation?
The vast majority of deferred compensation plans are used as an additional executive retirement benefit.
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Retirement plans and employee pensions are In some cases, employers invest the amount of deferred income into stock options or mutual fundsMutual FundsA mutual fund is a pool of money. With deferred compensation plans, employees can choose when to receive distributions. A compensation plan, also referred to as a "total compensation plan," encompasses all of the compensatory components of a company's strategy - employees' wages, salaries, benefits and total terms of payment.