I’m trying to classify portable pension plans. I understand that Defined Contribution Plans are readily portable, as oppose to Defined Benefit. But, how about ESOP and Cash Balance? Are they portable?
Each plan will have its own individual stipulations, but generally, yes and yes. Cash Balance pension plans typically receive a cash contribution that is some form of interest credit and percentage of salary credit. The balance accrues further company contributions and receives interest credits over time. At separation from service, employees will usually have the option to perform a rollover of that Cash Balance to an individual retirement account or possibly a DC plan at a new employer, if that new DC plan allows such rollovers. Again though, every plan is different and will have their own plan document that governs what the employee is able to do.