Compensation Glossary
Welcome to ERI SalaryExpert's compensation glossary, your resource for commonly used terms, formulas, and phrases related to compensation.
Life Cycle Pension Plan
A defined benefit plan that expresses benefits as a lump-sum benefit rather than as an annuity. There are no account balances for the plan participants. In addition, this plan recognizes final average salary in the benefit calculation. Under the life cycle plan, a participant earns credits for each year of service. Age is not directly a factor, except as it pertains to how much service an individual could accrue. The total of these credits is considered a percentage, which is multiplied by the annual final average salary of the participant to determine what lump sum will be paid at retirement. Also known as retirement bonus plan and lump-sum plan.
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Featured White Paper
Common Compensation Terms and Formulas - January 2026
Find commonly used compensation terms and formulas for your reference when planning compensation.
Ready to Streamline Your Compensation Strategy with Us?
Discover how our Assessor Platform can help you attract top talent, stay on top of market trends, and set your organization up for success, all in one platform.
Try a Free Demo
About Us
ERI SalaryExpert was launched in 2000 by ERI Economic Research Institute to help organizations and individuals optimize salary planning. Our robust compensation management solution houses the global salary survey data and applications needed to design competitive and effective compensation structures. From benchmarking with reliable market data to analyzing geographic differentials and conducting pay equity analyses, our intelligent platform is an innovative way of merging integral salary survey data with efficient features, all in one system.
Learn More