Multiple years of strong investment returns, coupled with a recent rise in pension plan discount rates, has improved funded status for the median U.S. corporate pension plan more in the last 90 days than in the last five years. With this success, plan actuaries are actively pitching plan termination to many plan sponsors, claiming financial and risk-management benefits. While many of these claims are significantly overstated, this will likely be the eventual path of most plan sponsors.
Tom Harvey and Casey Gillespie examine key considerations for making this decision, including the risks posed by the plan and examples demonstrating the costs of termination/termination option value.Read the paper
Client Investment Strategist
Information provided by SEI Investments Management Corporation (SIMC), a registered investment adviser and wholly owned subsidiary of SEI Investments Company.
Investing involves risk including possible loss of principal. There can be no assurance goals will be met nor that risk can be managed successfully.
This material represents an assessment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. This information should not be relied upon by the reader as research or investment advice and is intended for educational purposes only.