---
title: How Does Pension Vesting Work?
description: 'There are two basic types of vesting (ask your benefits administrator which one applies to you): Cliff Vesting and Graded Vesting.'
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    former_staff: true
published: '2014-05-20T15:18:25.000Z'
modified: '2014-05-20T15:18:25.000Z'
section: Retirement
tags:
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  - defined benefit plan
  - graded vesting
  - Pension
  - Pensions
  - Retirement
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canonical: https://money.com/collection-post/how-does-pension-vesting-work/
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![How Does Pension Vesting Work?](https://money.com/img/logo-social.png)

There are two basic types of vesting (ask your benefits administrator which one applies to you):

**Cliff vesting.** This typically means that if you leave the job in five years or less, you lose all pension benefits. But if you leave after five years, you get 100% of your promised benefits.

**Graded vesting.** With this kind of vesting, at a minimum you're entitled to 20% of your benefit if you leave after three years. In each subsequent year, another 20% of your benefit vests. So if you stay for four years, you are vested in 40% of your benefit and so on; by the end of year seven, you are 100% vested in the plan, so you can leave the job knowing that you will get 100% of the pension benefits earned.

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