A pension plan is a retirement savings plan that is sponsored by an employer. It provides employees with a steady income during their retirement years.

Employees contribute a portion of their salary to the pension plan, and the employer may also make contributions. The money is invested over time to grow the fund, which is then used to provide retirement income to the employee.

There are two main types of pension plans: defined benefit plans, which provide a specific benefit amount upon retirement, and defined contribution plans, where the final benefit amount depends on the contributions and investment performance.

Pension plans are typically insured by the Pension Benefit Guaranty Corporation (PBGC) in the United States, which provides some level of protection for participants in case the plan is unable to meet its obligations.

To maximize your pension benefits, consider contributing the maximum allowed amount to your pension plan, take advantage of any employer matching contributions, and review your investment options regularly to ensure your money is working for you.