But the research also points to a market that is booming, and proponents say it naturally complements 401(k)s: cash balance pension plans
Logue, 2004, Why Do Firms Convert to Cash Balance Pension Plans
? An Empirical Investigation, Working Paper, Cornell University.
* Cash balance pension plans
specify a formula for determining annual employer contributions to employee accounts as well as specify an interest rate applied to account balances.
held that cash balance pension plans
(4) do not age discriminate for
It made major changes in funding of defined contribution and cash balance pension plans
, and lots more.
401(k) plans, increased deduction limits, more frequent reporting and disclosure statements, broadened portability, cash balance pension plans
and changes to fiduciary rules governing investment advice.
With the evolution of cash balance pension plans
, companies that acquire others with more tradition al plans face risks when plans are converted to cash balance or diverted for other corporate uses.
Government Accountability Office contends that cash balance pension plans
that became popular 15 years ago have reduced corporate liabilities but have not been beneficial to retirees, particularly older workers.
Cash balance pension plans
can present concerns to corporate adopters that should be addressed and properly disclosed in their financial statements.
19, 2000, FEI's Committee on Benefits Finance (CBF), the technical committee that formulates FEI policy on matters pertaining to the design, implementation, financing and administration of employee compensation, pension and healthcare plans, responded to the Internal Revenue Service's request for comments on cash balance pension plans
In recent years, cash balance pension plans
have become increasingly popular among businesses and other organizations with traditional defined benefit pension plans.
Power, 2003, Determinants of Firms That Convert to Cash Balance Pension Plans
, Working Paper, Iowa State University, August.