The Motley Fool Discussion Boards

Previous Page

Investing/Strategies / Retirement Investing

URL:  https://boards.fool.com/although-defined-contribution-pension-plans-have-11181543.aspx

Subject:  Re: Cash Balance Pension Date:  8/23/1999  11:03 AM
Author:  pauleckler Number:  13350 of 96146

Although defined contribution pension plans have the effect of giving older employees less in pensions, they also remove a financial incentive for age discrimination.

With defined benefit pension plans, young employees company paid pension costs are peanuts, but pension costs for those close to employment are large.

Defined contribution plan levels the playing field. All employees pension costs are the same % of salary.

So its a mixed bag. Under the old system, those older folks who worked did better, but many did not work. Perhaps under the new system, hiring older workers will be easier.


Copyright 1996-2019 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us