January 2021

12Jan

US. Strong End to 2020 Puts DB Plan Funded Status Back to Where It Started the Year

The funded status of the nation’s largest corporate pension plans started and finished last year at the same level, as declining interest rates caused pension obligations to grow, offsetting gains from investments in equities and bonds, according to an analysis by Willis Towers Watson. Willis Towers Watson examined pension plan data for 366 Fortune 1000 companies that sponsor U.S. defined benefit (DB) plans and have a December fiscal-year-end date. Results indicate that the aggregate pension funded status is estimated...

January 12, 2021
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05Jan

How To Fix America’s Retirement Crisis: 10 Experts Weigh In

For decades there’s been a festering retirement crisis in America. Congress has repeatedly tried to resolve the retirement crisis via stop-gap, incremental efforts. It has created new retirement accounts, like Roth IRAs to benefit lower income workers, as well as tax-advantaged health savings accounts (HSAs) to help pay healthcare costs. It’s made it easier for small businesses to offer retirement plans, and it’s even allowed employers to auto-enroll employees. Also Read Americans retirement savings may not be that safe after all new surveyfinds Nevertheless, the retirement...

January 5, 2021
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January 2021
01Jan

The Shift to a Funded Social Security System: The Case of Argentina

By Joaquin Cottani & Gustavo Demarco The Argentine social security system has been modified a number of times since its creation in 1904. The pay-as-you-go system was adopted in 1954. The reform of 1969 established the system’s definitive structure, which remained substantially unchanged for more than twenty years. However, the system’s underlying financial problems led the government to undertake an integral reform of its social security program in 1993. The government adopted a mixed system by introducing private pensions into...

January 1, 2021
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01Jan

Retirement Savings in Mena

By Gustavo Demarco Public pensions are important in MENA, but their role as institutional investors remains uncertain in view of the sustainability problems that pension schemes are facing due to the over generosity of their promises. In addition to the gradual loss of reserves, portfolios are not very diversified and this, in turn, reveals a low level of professional management probably com bined with an absence of autonomy in the asset allocation process. An exception to this rule is the...

January 1, 2021
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December 2020

22Dec

Mexican President says the Maya train will pay for military pensions

Mexican President Andrés Manuel López Obrador said Sunday the army will run the Maya train project and several airports, and use any profits to finance military pensions. Read also Mexican Congress passes major reform to boost pensions The army is already overseeing construction on some parts of the controversial project, while private firms build the rest. But López Obrador said Sunday that “so there won’t be the temptation to privatize” the $6.8 billion project, the army will operate it once...

December 22, 2020
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16Dec

US. Stock Market Gains Help Pension Funding Levels: Pension and Group Annuity Update

Corporate bond interest rates fell a little in November, but the stock market did well, and that helped make the finances of big U.S. corporate pension plans look better, according to Milliman Inc. Zorast Wadia and Charles Clark, analysts at the Seattle-based actuarial consulting firm, found that the 100 large corporate pension plans they track reported a $272 billion combined deficit in November on $1.98 trillion in pension benefits obligations, compared with a $284 billion deficit on $1.915 trillion...

December 16, 2020
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11Dec

US. 4 Public Pension Funding Strategies Besides Employer Contributions

Maybe it’s time for pension plans to explore other funding strategies aside from public employer contributions. Plan sponsors typically use the annual required contribution (ARC) or the actuarially determined employer contribution (ADEC) to meet public pension liabilities. But a number of states have found success experimenting with lesser-known methods. It could be useful for other public retirement programs to consider these strategies, according to a report released this week from the National Institute on Retirement Security. While resilient...

December 11, 2020
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03Dec

DB or not DB, what is the solution?

By Mark Daniel  Mark Daniel takes us on a pensions journey, exploring various DB and DC plan designs and how these can help manage costs and possible risks. What a difference two years make. Boris Johnson is now the Prime Minister, Liverpool finally became Premier League Champions and, sadly (for me), Huddersfield Town are back down in football’s second tier. And then there is COVID-19. Who could have predicted any of the above? Admittedly, you didn’t need a...

December 3, 2020
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November 2020

11Nov

Funded Status of US Corporate Pensions Rises $21 Billion in October

The funded ratio of the 100 largest US corporate pension plans rose to 85.1% from 84.4% in October thanks to a third straight monthly increase in the discount rate, which helped boost the funded status of the plans by $21 billion, according to actuarial and consulting firm Milliman. The aggregate deficit of the plans, as tracked by the Milliman 100 Pension Funding Index (PFI), fell to $285 billion, which is its lowest level since March when it was $243...

November 11, 2020
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11Nov

U.K. deficits worsen in October as COVID-19 resurgence bites

The total deficit of U.K. defined benefit funds covered by the Pension Protection Fund's 7800 index increased 1.3% in October, to £168.2 billion ($217.7 billion). The deficit was £166.1 billion at the end of September. Deficits also worsened for the year ended Oct. 31, from £74.3 billion, said an update Tuesday by the London-based PPF. The PPF is the lifeboat fund for the defined benefit plans of insolvent U.K. companies. The funding ratio of the corporate pension plans worsened...

November 11, 2020
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