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Worldatwork T7 Exam - Topic 2 Question 108 Discussion

In a defined contribution benefit plan, who assumes risk?
A) Employees
B) Employers
C) Both employees and employers

Worldatwork T7 Exam - Topic 2 Question 108 Discussion

Actual exam question for Worldatwork's T7 exam
Question #: 108
Topic #: 2
[All T7 Questions]

In a defined contribution benefit plan, who assumes risk?

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Suggested Answer: A

by Talia at Mar 05, 2025, 09:29 AM

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Tammy
8 months ago
It's definitely employees, they control their own contributions.
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Melissa
8 months ago
Totally agree, it's all on the employees!
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Gertude
8 months ago
Sounds right, but I still have my doubts about how that works in practice.
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Alona
8 months ago
Wait, are you sure? I thought employers had some responsibility too.
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Basilia
8 months ago
Employees assume the risk in a defined contribution plan.
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Queen
9 months ago
I definitely recall that in defined contribution plans, the employees bear the investment risk.
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Oneida
9 months ago
I’m a bit confused; I thought the employer had some responsibility too, but maybe that’s only in defined benefit plans?
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Nickole
9 months ago
I remember a practice question where it mentioned that both employees and employers contribute, but the risk is mostly on the employees.
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Chun
9 months ago
I think the employees assume the risk in a defined contribution plan, but I'm not entirely sure.
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Theodora
10 months ago
I think the key here is understanding the difference between defined contribution and defined benefit plans. In a defined contribution plan, the employee bears the investment risk, not the employer.
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Loren
10 months ago
Okay, I remember learning about this in class. I believe the correct answer is C - both employees and employers assume risk in a defined contribution plan.
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Page
10 months ago
Hmm, I'm a little unsure about this one. I'll need to think it through carefully.
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Kiley
10 months ago
I'm pretty sure the answer is A - employees assume the risk in a defined contribution plan.
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Laurel
1 year ago
Yes, that's correct. Employers only contribute a fixed amount, so the investment risk falls on the employees.
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Kristal
1 year ago
Ha! Both of them, like a seesaw. The employees are on one end, the employers on the other. Gotta keep that balance, am I right?
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Arthur
1 year ago
C) Both employees and employers
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Carin
1 year ago
B) Employers
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Eliseo
1 year ago
A) Employees
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Eveline
1 year ago
But in a defined contribution plan, employees bear the investment risk, right?
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Hector
1 year ago
Definitely the employers. They're the ones who have to make the contributions and ensure the plan is properly funded.
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Latricia
1 year ago
Employees don't have to worry about the risk in this type of plan.
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Cheryl
1 year ago
That's correct. Employers are responsible for making contributions and funding the plan.
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Gilbert
1 year ago
Employers assume the risk in a defined contribution benefit plan.
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Loreen
1 year ago
The employees, of course. They're the ones who have to bear the risk of their investments in the plan.
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Katina
1 year ago
It's important for employees to carefully consider their investment options in these plans.
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Louann
1 year ago
That's right, employees assume the risk in a defined contribution benefit plan.
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Destiny
1 year ago
Employees
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Tonja
1 year ago
I disagree, I believe it's the employers who assume the risk.
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Eveline
1 year ago
I think employees assume the risk.
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