A Defined Benefit Plan is a type of retirement plan where an employer guarantees a specific payout to employees upon retirement. The amount is usually based on factors such as salary history and years of service. This means that employees can expect a predictable income during retirement, which can help with financial planning. These plans are funded by the employer, who is responsible for managing the investments and ensuring there are enough funds to meet future obligations. Unlike Defined Contribution Plans, where employees contribute and investment risks are borne by them, Defined Benefit Plans provide a stable income regardless of market fluctuations.