Risk Allocation in Retirement Plans: A Better Solution
The corporate world is reconsidering the cost-effectiveness of defined benefit pension plans while contemplating a change to defined contribution plans. This article begins by examining the three primary risks faced by sponsors of most DB pension plans-investment risk, interest rate risk, and longevity risk-and shows how shifting these risks to employees through a DC plan would affect both the corporation and the individual. Although DC plans clearly help companies manage risks, they provide at best an incomplete solution for individual participants. 2006 Morgan Stanley.
Year of publication: |
2006
|
---|---|
Authors: | Fuerst, Donald E. |
Published in: |
Journal of Applied Corporate Finance. - Morgan Stanley, ISSN 1078-1196. - Vol. 18.2006, 1, p. 95-103
|
Publisher: |
Morgan Stanley |
Saved in:
freely available
Saved in favorites
Similar items by person
-
Technical review panel for the pension insurance modeling system (PIMS)
Mitchell, Olivia S., (2013)
-
Retirement shares plan : a new model for risk sharing
Fuerst, Donald E., (2016)
-
Observations on Actuarial Assumptions and Models for Defined Benefit Pension Plans
Fuerst, Donald E., (2013)
- More ...