Workforce Management, September 8, 2008

Jessica Marquez reports that espite the widespread notion that defined-benefit plans are more expensive for employers to manage than defined-contribution plans, a new report finds that might not be the case.

The article indicates that in fact, defined-benefit plans can deliver the same benefit at half the cost of defined-contribution plans, according to “A Better Bang for the Buck,” which was published in August by the National Institute on Retirement Security, a Washington-based nonprofit organization.

“Defined-benefit plans can maintain a well-diversified portfolio over time. But as individual 401(k) account holders age, [they] are advised by experts to move to more conservative investments as they get older to protect their assets from the risk of market shock,” says Beth Almeida, executive director of the institute. Read the full article here. (Subscription Required)