Question

Steve is choosing between two jobs at Smithsonian museums. One job is funded through the federal government and offers a pension plan. The other job is privately funded and offers a 403(b) plan similar to a 401(k) plan, in which the Smithsonian would contribute 7% of Steve's salary. What factor would make Steve prefer the federal job and pension?

Answer 1

private funding can run out. federal funding will likely not run out

Answer 2

The government career are likely to be more stable than the private sector

Explanation:

The federal job will likely to be more stable. This is because of the decided benefits that are offered by the employer after finishing the career. This is unlike the privately funded job that offers the decided contribution, but can become easily less stable and affected by the changes in the economy. Hence, as a result of the factors, Steve will prefer a federal job.