Consumer Agenda for Retirement Security

Initiative #4: Improve traditional and hybrid pension plans

G. Restore more realistic funding requirements for ongoing pension plans.

Congress amended the pension funding rules for defined benefit plans to impose more accelerated funding requirements on employers.  More particularly, funding shortfalls now generally have to be amortized over a seven-year period.  In effect, this can mean sudden and unpredictable funding obligations, which might lead some employers to decide to terminate or freeze their defined benefit plan.  This burden on budgeting for cash flow can be eased by extending the amortization period to 10 years. 

Learn more about the other initiatives in the Consumer Agenda for Retirement Security.

Initiative 1: Promote a more adequate and secure private retirement income system.
Initiative 2: Empower workers to promote their own retirement security.
Initiative 3: Improve retirement savings plans.
Initiative 4: Improve traditional and hybrid pension plans.
Initiative 5: Make retirement plans fairer for workers and their spouses.

Print the Consumer Agenda for Retirement Security [PDF].