Which retirement program promises employees a specific pension amount based on age and years of service?

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The Defined Benefit Plan is designed to provide employees with a predetermined pension amount, which is typically calculated based on factors such as the employee's age, years of service, and salary history. This type of retirement program guarantees a specific payout to the employee upon retirement, allowing for predictable financial planning for both the employee and the employer.

In a Defined Benefit Plan, the employer assumes the investment risk and is responsible for funding the plan adequately to meet the promised benefits. This contrasts with a Defined Contribution Plan, where the amount contributed is specified, but the retirement benefit may vary based on investment performance. A 401(k) is a specific type of Defined Contribution Plan that allows employees to save and invest for retirement but does not guarantee a specific payout. The term "Retirement Plan" is a general term that encompasses various types of plans but does not specify the structure or guarantees associated with the benefits.