Target Benefit Pension Plans

Question 1

When is actuary work required in a target benefit pension plan?

Answer 1

Only at plan inception

Question 2

Can employees contribute to a target benefit pension plan?

Answer 2

Nope - 100% employer funded

Question 3

What are three reasons an employer may choose to initiate a target benefit pension plan?

Answer 3

-They want to skew plan contributions to older participants
-They want employees to bear the investment risk (DC)
-They want a plan that is easy to understand (DC)
-They want guaranteed yearly contributions (pension)