What is a Thrift or Savings Plan?
A Thrift or Savings Plan is A Defined Contribution Plan in which employees are
directly
involved in contributing toward the ultimate benefits that will be provided.
The Plan
can be in the form of a Money Purchase or a Profit Sharing Plan. Some of the
main features
are as follows;
 | Employer Contributions are geared toward mandatory
contributions by the employee. Only the employees that contribute a portion of their salary can participate in the Plan (ie share in the employer's contribution). |
| Employer contributions are made on a matching basis. |
| The Plan must satisfy a non discrimination test that
measures the contributions of the Highly Compensated Employees against the Non-Highly Compensated Employees |
| The Plan may permit the employer to make an additional contributions |
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