Living longer raises costs of public plans

2015-04-23T17:31:04-07:00April 23rd, 2015|Categories: Retirement|Tags: , , |

The fact that people are living longer is good news from a human perspective. But longer lifespans also make defined benefit pension plans more expensive because sponsors must pay benefits to retirees for a longer period of time. In 2014, CalPERS – one of the nation’s largest plans – revised its longevity assumptions, significantly increasing its liabilities and reducing its funded ratio by 5 percentage points. This event led us to wonder whether other shoes were about to drop [...]