A Guide to Comparing Defined Benefit and Defined Contribution Pensions

This Guide to the Comparison of Defined Benefit and Defined Contribution Pension schemes is intended for anyone who has a UK pension scheme and is wondering exactly what pensions they have and whether they are in the right schemes for them.

Introduction to UK Pensions

If you work or have worked for a UK employer, the chances are that you would have joined a pension scheme, set up by that employer.

There are many different names for these pensions with a variety of different pension providers, that could be looking after your pension funds, however, when you break it down, there are only two main types of UK pension scheme.

The two main types are Defined Benefit (sometimes known as a final salary) schemes and Defined Contribution (sometimes known as money purchase) schemes. During your working life, across many jobs, you could become a member of one or the other – or quite possibly both.