401k vs Pension

• CPF is a real lifetime pension, with benefits calculated using a set formula—a 401(k) is simply an individual savings account subject to market fluctuations.
• Only employers finance CPF—401(k) participants must finance their own accounts.
• CPF pays a guaranteed monthly benefit for life—401(k) benefit levels are not known until it is time to retire and you might outlive those benefits.
• CPF provides spouse, disability and death benefits—401(k)s do not.
• CPF’s benefits are insured to the limits set by the Pension Benefit Guaranty Corporation—401(k) accounts have no such protection.
• CPF’s benefits exceed any that can reasonably be expected from a 401(k)—without the risks

CPF vs. 401(k): A 25-Year Comparison

See the presentation below to compare hypothetical CPF and 401(k) benefits that would have accrued from 1995 to 2019.