More companies have shifted away from defined-benefit plans in the past few decades, as they struggle with mounting pension obligations. Now, a new report argues that the large-scale move by companies toward defined-contribution 401(k) plans is widening the gap between rich and poor in the United States. […]
Click here to read the National Conference on Public Employee Retirement Systems (NCPERS) report on income inequality. The research was conducted by Michael Kahn, Ph.D., who was a panelist at the 2014 CORPaTH Summit and Crystal Globe Awards.
Rising income inequality is a byproduct of pension reform actions that have made people rely on defined contribution plans rather than defined benefit plans. So says research from the National Conference on Public Employee Retirement Systems, which made the point in a paper titled “Income Inequality: Hidden Economic Cost of Prevailing Approaches to Pension Reforms.” The paper found that benefit cuts, larger employee contributions and conversion of DB plans into DC plans had a negative impact, not just on plan [...]
Remember how everyone sensible knew the housing market was in a bubble 10 years ago but nobody really focused on what that would mean? I wonder today if we are in a similar situation regarding retirement. Everybody sensible knows we are facing a looming retirement crisis. Tens of millions of baby boomers are starting to retire. They are going to live in old age far longer than previous generations. Tomorrow’s grandma is going to need medical care and nursing [...]