vesting Hear it!

vesting definition - finance
The right that an employee has to receive contributions made by their employers to an employer-contributed pension plan, a 401(k) plan, or a profit-sharing plan. The federal government requires that employees must be fully vested, or be given the right, to own all of their employerÂ’s contributions after a certain time period. Usually vesting rights are given on a graduated schedule, with 20 percent of the contribution being vested each year.

Webster's New World Finance and Investment Dictionary Copyright © 2003 by Wiley Publishing, Inc., Indianapolis, Indiana.
Used by arrangement with John Wiley & Sons, Inc.

Comments
Improve this definition.
Do you have more to add? Share your linguistic knowledge or observation.
/Register to save your comments.