The Lowdown on Pensions

In the United States, pensions are a source of retirement income common to jobs in government, military, education and manufacturing, as well as policing and firefighting. But they are increasingly rare in other professions.

Pension funds are accumulated through employee contributions and sometimes employer contributions. Employees start collecting their pensions upon retirement, with employers setting their own retirement guidelines. Because of their size, the investment portfolios of pension funds are closely watched.

If your employer does not operate a pension fund, your best bet is to maintain your own retirement accounts, with similar tax savings. The big difference is that you have more control in deciding where to invest the money.