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DB Benefit Plan Evolution

Defined Benefit Plan Evolution

Trends and challenges

Austerity measures, cost of capital, insurance premiums, and tax policies are just a few issues that are pressuring traditional DB plan thinking. Success for plan sponsors is dependent on evolving their approach to DB plans.

Reforming state retirement plans…

A state’s appetite for pension reform was largely in line with the size of fiscal issues the state faced.

Graph

Source: Invesco Ltd. as of June 2018. In cases where a state has more than one alternative plan, the plan type with the greater number of participants is marked on the map. This includes Indiana where workers choose between a DB, hybrid or DC plan, and Utah where workers choose between a hybrid and DC plan. Texas’s cash balance is only available to local workers. California provides an optional cash balance plan for part-time workers and adjunct educational employees.

Let us help solve your pension plan challenges

Invesco’s Turning Points Guide features our latest thinking on defined benefit trends, with actionable steps to help optimize plan outcomes.

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