Magazine article Workforce Management

More Workers Checking in on Pension Plans

Magazine article Workforce Management

More Workers Checking in on Pension Plans

Article excerpt


Defined-contribution participants aren't the only ones asking whether they will have enough money for retirement, one consulting group has found.

Mercer reported a 40 percent increase in defined-benefit participants asking for their estimated end benefit in 2009 versus 2008, says Andrew Yerre, defined-benefit business leader in the company's U.S. outsourcing division.

The Mercer unit, which consults on domestic outsourcing and investment issues, is the defined-benefit administrator for 73 clients with 260 defined-benefit plans covering 1.3 million people, says Bruce Lee, principal and spokesman. Last year, 80,000 people asked the company to calculate their estimated benefits, he added.

"The drop in the markets prompted a lot of people to look at employer-sponsored benefits," Yerre says.

A new annual funding notice is probably another cause for the bump in requests, Yerre says. Before an overhaul to pension law in 2006, participants received arcane and heavily detailed summary annual reports on the status of their defined-benefìt plans.

Because of the new law, participants now receive an annual funding notice in addition to the report. This notice simplifies the financial information found in the report, highlighting the funded status or health of the plan as well as its liabilities. The notice doesn't give participants specific details about their personal estimated end benefit, but it does outline how to request that information.

The annual funding notice has been in effect only since 2008, so this is the first time Mercer has looked at the number of participant requests for information, Lee says. …

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