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These Are the Jobs That Still Offer a Pension

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In an era when employer-sponsored retirement plans like 401(k)s have become the norm, pensions are becoming an endangered species. A pension is a retirement plan that guarantees a steady income stream to retirees for life, with the employer bearing the investment risk. In contrast, 401(k) and 403(b) plans are defined contribution plans where employees shoulder the investment risk and must carefully manage their retirement savings.

While pensions were once prevalent across industries, economic pressures and accounting rule changes have led many private companies to freeze or terminate their pension plans. However, there are still a few bastions where traditional pensions survive. Here are some of the jobs that still offer this coveted retirement benefit.

Government jobs

If pensions are your priority, government jobs are the way to go. Many government jobs at the federal, state, and local levels still provide pension plans for their employees. This includes roles like public school teachers, police officers, firefighters, and other civil servants. The retirement benefits are usually part of the compensation package negotiated by public employee unions.

Utilities

Utility companies like electric, gas, and water providers frequently still have pension plans. The regulated nature of utilities has allowed some to maintain their defined benefit pension plans.

Unions

Jobs covered by union labor agreements, particularly in industries like transportation, manufacturing, or construction, are more likely to include a pension as a hard-won benefit.

Military

After serving for 20 years or more, members of the armed forces are eligible for a military pension that pays lifetime retired pay.

Some corporate giants

While rarer than in previous decades, a small number of large corporations still offer pension plans. These include some automotive companies, airlines, and other legacy companies with a heavily unionized workforce.

The appeal of pensions is obvious—they provide retirees with a dependable income stream not tethered to market returns. But the costs and risks associated with paying pension benefits have led to their decline. For most workers today, a 401(k), IRA, or similar defined contribution plan is their primary employer-sponsored retirement vessel, putting investment responsibility on their shoulders. Pensions, while fading, do still exist for certain professions, particularly in the public sector.

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