Ideco, DC, DB, what's the difference?

[Michel]

Hello,

In another recent thread I saw the terms, Ideco, defined contribution and defined benefit being mentioned and it got me a little confused as to what is what and for whom?

From my understanding Ideco is for everyone (?) with different contribution limits depending on your profession.

Defined contribution (DC) is provided by your employer if they have it set up, therefore not every company offers it to their employees (consequently freelancers have no access to it).

Defined benefit (DB)...no idea.

Follow up question, can someone with DC (and DB?) also have an Ideco? My partner has a DC set up at her company since last year so would she be able to open an Ideco?

[adamu]

Defined benefit: You pay in (a possibly defined amount) and get a defined amount at the end. The "benefit" is defined.
Defined contribution: You pay a defined amount, and get an undefined amount at the end. The contribution is defined.
iDeCo: Short for Individual Defined Contribution Pension. It's a type of DC pension that you apply for as an individual. There are also non-individual company run DC schemes.

Can someone with DC (and DB?) also have an Ideco? My partner has a DC set up at her company since last year so would she be able to open an Ideco?

It depends on whether the corporate DC (or DB) plan she's enrolled in permits it or not. It seems to be necessary to check individually.

There is some official English information available here: https://www.ideco-koushiki.jp/english/

Here is the Japanese site that talks about joining iDeCo if you're already in a corporate DC Scheme.
https://www.ideco-koushiki.jp/retirement/

[Kanto]

This chart is quite helpful.

[Michel]

Defined benefit: You pay in (a possibly defined amount) and get a defined amount at the end. The "benefit" is defined.
Defined contribution: You pay a defined amount, and get an undefined amount at the end. The contribution is defined.
iDeCo: Short for Individual Defined Contribution Pension. It's a type of DC pension that you apply for as an individual. There are also non-individual company run DC schemes.

Can someone with DC (and DB?) also have an Ideco? My partner has a DC set up at her company since last year so would she be able to open an Ideco?

It depends on whether the corporate DC (or DB) plan she's enrolled in permits it or not. It seems to be necessary to check individually.

There is some official English information available here: https://www.ideco-koushiki.jp/english/

Here is the Japanese site that talks about joining iDeCo if you're already in a corporate DC Scheme.
https://www.ideco-koushiki.jp/retirement/

Thank you, it makes sense, they actually mean what they mean, I feel stupid for not seeing the logic

[Michel]

This chart is quite helpful.

Thank you!