Economic turmoil has dealth pension plans a hard blow in recent years, with both DB and DC plans struggling to deliver sustainable retirement benefits. The solution, according to Aon Hewitt, is in target benefit plans. The firm has released a guide, Target Benefit Plans: The Future of Sustainable Retirement Programs, outlining the need for a new approach to retirement plans.
Canada needs to look to target benefit plans if we are to have achieve adequate retirement savings, says the Association of Canadian Pension Management (ACPM) in its new Target Benefit Plan Paper.
The pooled registered pension plan (PRPP) announced by the federal government last year is the first step in the reforms needed to extend pension coverage to the more than 60% of the Canadian workforce not currently enrolled in a workplace plan. However, as the Ontario government hinted in its recent budget, there are a number of challenges with the PRPP design.
A passion for using Excel files to model financial trends led Toronto-based Malcolm Hamilton to the uncomfortable realization, in the mid-1990s, that DB plans were not going to work.
Air Canada and the union representing its flight attendants recently agreed to a new hybrid pension plan for new hires. It consists of a slimmed down DB tier, supplemented by a new DC tier. Some observers think this announcement signals a change in direction for pension plans, but that is unlikely to be the case. […]
Currently, only four out of every 10 Canadians are covered by a pension plan other than CPP or QPP. Employers often don’t like DB plans because they’re too risky. Employees will take anything they can get but would normally prefer DB plans. How do we resolve this conflict and increase pension plan coverage in Canada? […]
Target benefit pension plans and target date funds (TDFs) may be similar in name, but they are worlds apart when it comes to the benefits they provide—and the communications strategies required to help them succeed. Target benefit pension plans vs. TDFs Target benefit pension plans are a special breed of pension plan. They combine a […]