Traditional Defined Benefit (DB) Pension Systems
Each party contributes to the retirement fund; the employee contribution is almost always fixed—i.e., does not vary from one year to the next.
The retirement benefit is guaranteed, and is usually based on age, “final” salary, and years of service: e.g., “2% @ 55” (see example).
The money is managed in a pool to reduce overhead.
Investment risk is the responsibility of the employer.
Risks are spread over time.
Often provide inflation protection and disability and death benefits.
Have some degree of “portability” depending on reciprocal agreements with other public agencies.