A pension system is a financial arrangement designed to provide individuals with income after they retire from work. It typically involves contributions made during a person's working life, which are then invested to grow over time. When individuals retire, they receive regular payments from the pension fund, helping to support their living expenses. There are various types of pension systems, including defined benefit plans, where retirees receive a fixed amount based on their salary and years of service, and defined contribution plans, where the retirement income depends on the amount contributed and investment performance. These systems aim to ensure financial security for retirees.