Lump sum windows and other pension risk transfer strategies continue to be popular among many defined benefit (DB) pension plan sponsors. Paying lump sums to terminated vested participants can reduce long-term plan costs and risks by permanently eliminating these liabilities. However, the cost of the lump sum payments is heavily influenced by the underlying interest […]Read More… from Pension Lump Sums Less Expensive in 2019
How quickly things change! A month ago we were anticipating very expensive 2017 lump sum costs for defined benefit (DB) pension plans due to continually low interest rates. However, rates have been on a strong rebound since the election and now 2017 lump sums are looking much more affordable. The IRS recently released the November […]Read More… from 2017 Pension Lump Sums Are Looking More Affordable
Many defined benefit (DB) plan sponsors are aware that interest rates dropped significantly in the first half of 2016 but staged a remarkable rise since the November election. Combined with relatively strong equity returns, 2016 year-end pension disclosures may not be as bad as expected 6 to 8 weeks ago. Discount Rate Analysis Using the […]Read More… from 2016 Pension Accounting Preview: a Positive Outlook
Lump sum windows and other pension risk transfer strategies continue to be popular among many defined benefit (DB) pension plan sponsors. Paying lump sums to terminated vested participants can reduce long-term plan costs and risks by permanently eliminating these liabilities. However, the cost of the lump sum payments is heavily influenced by the underlying interest […]Read More… from Pension Lump Sums Likely More Expensive in 2017
The combination of lower discount rates and new mortality tables will dramatically increase pension plan liabilities and decrease DB plans’ funded status for December 31, 2014 financial reporting. Using the November 2014 Citigroup Pension Liability Index (CPLI) and Citigroup Pension Discount Curve (CPDC) as proxies, pension accounting discount rates are down by almost 90 basis […]Read More… from DB Plan Sponsors Should Prepare Now for Higher Year-End Liabilities
The final results are in and pension plan sponsors should be pleased with final year-end discount rates – at least compared to the FY2012 rates. Using the Citigroup Pension Liability Index (CPLI) and Citigroup Pension Discount Curve (CPDC) as proxies, pension accounting discount rates are up by about 90 basis points this year. This is […]Read More… from Higher Discount Rates Will Help 2013 Pension Disclosures and 2014 Expense
