Traditional Pensions on the Wane

Traditional defined benefit (DB) pensions are losing ground to defined-contribution (DC) models, according to recent findings from the Employee Benefit Research Institute (EBRI).

Studying trends between 1975-2001, EBRI found that although the number of total plan participants remained consistent and assets grew, the number of DB plans decreased by nearly 80% to 36,000 in 2001, compared to 175,000 in 1975.

Government regulation, risks associated with funding pension plans, and a greater employee appreciation for DC plans have spurred the DB decline.

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