What is a Pension?

Pension usually refers to the remuneration or payment a person receives after he retires from the active job. He is paid a part of the salary which he used to draw when employed. He gets this payment without working. Mostly, the terms of pension payment are decided before one gets into a contract with the employer.
In most cases, the pension is paid from a common fund in which the employee would have contributed a portion of his salary while on job. A similar portion would have been added by the employer or the government.

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