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Another analysis points to pension funding woes

August 12, 2009 by  

Another analysis points to pension funding woes A second study in less than a month has drawn attention to the fact that despite asset gains in July pension plans still experienced a decline.

According to Milliman 100 Pension Funding Index, released by a global consulting and actuarial firm Milliman Inc., pensions experienced asset increases of $31 billion and liability increases of some $46 billion, with a net decrease of $15 billion in funded status.

The index consists of 100 of the nation’s largest defined benefit pension plans.

"We’re losing ground because of declining interest rates," said John Ehrhardt, co-author of the index.

"At this pace, getting back to a mere 80 percent funded status by the end of the year is going to require both favorable interest rate movement and better than 20 percent return on assets," he added.

He furthermore revealed that the cumulative asset return has been a negative 10.85 percent, and the funded status has fallen by $333 billion during the past 12 months.

Milliman has conducted an annual study of the 100 largest defined benefit pension plans sponsored by U.S. public companies for the past nine years. The index projects the funded status for these plans, reflecting the monthly market returns and interest-rate changes, and using the actual reported asset values, liabilities and asset allocations of the companies’ pension plans.

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  • s c

    There’s no mystery about pension funding woes. We, the people, don’t have the ‘luxury’ of printing our own money. We can’t ‘borrow,’ to compensate for unethical, illegal and immoral funding practices. We don’t have ‘friends’ in Washington who block investigations that should have thrown many career Washington criminals into prison for life.
    We have to live in the real world. Politicians specialize in breaking laws and pocketing our wealth. We realize that social insecurity and medicare are in deep doodoo, and we have been forced to re-think our retirement. Career criminal politicians remain above the law. They can pad their salaries and retirement at will, thwart justice 24/7, thumb their noses at us and expect to stay in office so they can ‘protect the working man,’ get re-elected, and become filthy rich in the process.
    As long as Washington gets to make, break and bend the rules without suffering any consequences, we will have very little control over any retirement issues. Why should career criminals have an outrageous retirement, when we can’t count on being able to retire?
    The American people know the difference between right and wrong. Washington hasn’t had to know it for over 100 years. Our ‘leaders’ don’t have a clue. Amazingly, that gives them their edge, keeps them in office, and makes life, liberty and the pursuit of happiness such a #&$^%*@ joke.

  • RayD

    SC Above comment could not be more true. The only thing I can say about his comment is right on SC. Keep it up.


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