Which of the following is NOT a retirement plan design option?

The option identified here as not being a recognized retirement plan design option is indeed the correct choice. Retirement plans generally fall under established categories that relate to how benefits are structured and funded.

Defined benefit plans guarantee a specific retirement benefit amount based on a formula, typically considering factors like salary history and years of service. This design option offers predictability for employees regarding their retirement income.

Defined contribution plans, on the other hand, do not guarantee a specific amount at retirement. Instead, contributions from the employee, employer, or both are invested, and the retirement benefit depends on the performance of those investments over time. This option includes 401(k) plans, where employees often contribute a portion of their salary with potential employer matching.

Hybrid plans combine elements of both defined benefit and defined contribution structures, offering a balance between the predictability of a defined benefit and the individual account features of a defined contribution plan.

The term "contributory investment," while it might refer to an aspect of contributory plans, is not widely recognized as a distinct retirement plan design option. This term does not align with the established categories of retirement plans and can lead to confusion regarding its nature and structure within the retirement planning framework.