Fixing the Defined Benefits Pension Plan, 401k Annuities, and More

The defined benefits pension plan, 401k annuities, and more are subjects of American retirement plan reform.

The American Retirement System has been a defined benefits pension plan / defined contribution program added on to Social Security. Award-winning consultant and writer Anna Rappaport sees the need for change within that system.

What is retirement age? Rappaport suggests changing the answer to equate more closely with "old age."

What Other Changes Are Up for Discussion?

The Departments of Treasury and Labor have polled Americans on just that same subject.

Both the industry and the public are exploring lifetime annuities in the form of 401k annuities that would give the 401k one of the features of the traditional defined benefits pension plan. TIAA-CREF, in fact, is proposing holistic 401k annuities.

Forty-two percent of 401k programs do offer 401k annuities, but the Obama Administration wants to make them mandatory. The administration also seeks better financial counseling and notification processes for 401k participants, using Social Security statements as a model.

Of course, Americans become fascinated with models from overseas. Right now, Australia, New Zealand, and Canada shine as beacons of light in areas of pension policy.

Americans in general are smiling favorably at 401k annuities and, more recently, automatic 401k enrolment and the automatic IRA. Apart from the 401k and defined benefits pension plan, cash balance accounts receive kudos for the flexibility, portability, and attractiveness to workers.

For small companies, banding together to offer multi-employer retirement plans is also on the horizon.

Senators Tom Harkin, Herb Kohl, and others are championing pension reform on the governmental level. Legislation has been presented to Congress. But Republicans and resistors of regulation are against it.

Topic: Fixing the Retirement System Subtopics: The American Retirement System • What Is Retirement Age? • Pension Retirement Plan Reform • Lifetime Annuities • 401k Annuities • 401k Annuities: A Proposal from TIAA-CREF• 401k Annuities: Popular Support • Cash Balance Accounts • White House Reform • Obama Retirement Reform • Social Security Statements as a Model • Models from Australia, New Zealand, and Canada • What the Public Wants • Multi-Employer Plans • Automatic 401k • Automatic IRA • Tom Harkin • Herb Kohl • Other Advocates of Pension Reform • Opposition to Reform