1. In a defined contribution plan - the employer and the employee make regular contributions to the fund. 2. When there is a change in the economic growth - investment returns or demographic expectations on which the benefit payouts are based - the quantum of payout is threatened.(c)There is a promise to contribute a fixed amount - usually a percentage of the employee's income - during his working years. 4. There is no obligation to pay a fixed amount during retirement years. 5. The employee can choose the investment vehicle andthe amount he accrues depends on his and the employer's contribution to the fund and how long the money has grown.