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Plan de-risking

IRS proposes new regulations/mortality tables for DB valuations

On April 28, 2022, the IRS published proposed regulations/mortality tables for determining the present value of benefits under defined benefit plans for purposes of determining the plan’s ERISA minimum funding requirements, Pension Benefit Guaranty Corporation variable-rate premiums, and lump-sum valuations.

De-risking in 2022 – Part 1

In this article, we provide our standard analysis of de-risking: how changes in interest rates and Pension Benefit Guaranty Corporation premiums may affect sponsor decisions to de-risk (or not de-risk) defined benefit plan liabilities in 2022. For purposes of this article, we focus solely on de-risking by paying out a deferred vested participant’s benefit as a lump sum and thereby eliminating the related liability.

Retirement Policy Update – November 2021

President Biden signed into law the Infrastructure Investment and Jobs Act (IIJA). The new legislation (among many other things) extends 25-year average interest rate stabilization relief under ERISA’s DB plan minimum funding rules another five years.

De-risking in 2021 – Part 1

In this article we provide our standard analysis of de-risking: how changes in interest rates and Pension Benefit Guaranty Corporation premiums may affect sponsor decisions to de-risk (or not de-risk) defined benefit plan liabilities in 2021.

2020 lessons learned – annuity settlements for small benefits

Even for plans not at the VRP headcount cap, with respect to (relatively) smaller benefits, annuity settlement may be an efficient strategy. For almost all pension plans, there exists a threshold, greater than zero, below which these settlements make sense.