The minimum contributions U.S. companies are required to make to their pension plans will rise significantly in coming years, according to a recent study by the Society of Actuaries, which says that increase could lead to more changes in the way companies manage their pension plans.
In the decade that ended in 2009, companies' cash contributions to their defined-benefit plans averaged about $66 billion a year, according to the SOA study. It projects that minimum required contributions will average $90 billion a year in the decade that started in 2010 and hit a peak of about $140 billion in 2016.
The higher contributions reflect the damage done to pension funding during the financial crisis, according to the SOA. The study was released on the heels of a quarter in which the funded status of U.S. pension plans took another beating.
Complete your profile to continue reading and get FREE access to Treasury & Risk, part of your ALM digital membership.
Your access to unlimited Treasury & Risk content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Thought leadership on regulatory changes, economic trends, corporate success stories, and tactical solutions for treasurers, CFOs, risk managers, controllers, and other finance professionals
- Informative weekly newsletter featuring news, analysis, real-world case studies, and other critical content
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the employee benefits and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
