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Benefits June 13, 2012
Majority of DB Participants Still Accruing Benefits
June 13, 2012 (PLANSPONSOR.com) – Nearly half (47%) of corporate defined benefit (DB) plans are still active and open to new hires.
Reported by Rebecca Moore
In addition, 71% of all DB plan participants are still accruing benefits, according to SEI’s Pension Lifecycle Meter, a survey of more than 150 U.S. corporate DB plans.
As of May, 24% of plans were closed to new entrants, but participants were still accruing benefits; 28% were “frozen” in that the plan is closed to new entrants, participants are no longer accruing benefits, but the termination process has not started; and 1% were “terminating” in that the plan is closed, accruals are frozen, and the termination process is underway.
Plan sponsors who indicated that their pension plans are currently closed, frozen, or terminating, were asked how recently they had made a design change to their plans, and only 12% indicated that they had made a change within the last 12 months. Three-quarters (75%) said that they had made a change more than two years ago. Of this group, one-third (33%) have plans larger than $500 million in assets.
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