2 thoughts on “Forbes post, “Did Pension Actuaries Miss Their Chance To Make A Difference?”

  1. Hi Jane, love your thoughts! As to the question of why DB plans continue to decline and target benefit plans and other hybrids never really caught on, I suspect it comes down to increased comfort with investment risk. The generation that fought for and won defined benefit pensions would never have dreamed they could run their own investments. Investments were inaccessible for most people and the knowledge of how to invest wasn’t widely known, so it’s understandable one would hesitate to take on investment risk. Starting in the 80s with the advent of lower cost advisory, and really the wide dissemination of information relating to investing, more and more people started investing their own money. This democratization of the investment industry has progressed to such a state today that everyone and their dog seems able to run a portfolio or at least has a friend who will do it for them. So they’re not as fearful as people once were about taking the investment risk. Add to this the great pension surpluses of the 1990s, and the great returns of the last 10 years ( notwithstanding the last month) and I believe people generally have the expectation that investment returns will over time make up for any other deficiencies of DC/401k plans.

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