PHR Exam Prep™

Optional Benefits Programs

Let's now take a look at some of the different types of benefits programs organizations offer that are completely voluntary.

NOTE

Voluntary benefits are ones that the organization freely chooses to offer, perhaps because those benefits are consistent with designing a total compensation package that is consistent with the organization's total compensation philosophy.

Retirement Plans

By definition, retirement plans “defer” income—and therefore defer the tax that must be paid on that money until it actually becomes income, which occurs at the time of distribution. Here are some examples of specific retirement plans.

Defined Benefit Plan

Defined benefits plans represent a more traditional type of pension plan, in which ...