Costs Remain Key Priority
companies have already closed their pension plans to new entrants and another 25 have frozen them , the survey found . Executives cited concerns about the impact of defined benefits plans on earnings , balance sheets and their companies ’ ability to invest in growth opportunities . The survey found that companies continue to prefer defined contribution plans such as 401 ( k ) where employees contribute their own money to their retirement plan , usually with matching dollars from the company .
“ The rebound in financial markets has not only restored the value of 401 ( k ) plans but helped improve the funding levels of defined benefit plans as well , though market volatility and other risk factors remain a concern ,” said Phil Waldeck , senior vice president , Pensions and Structured Solutions , Prudential Retirement . “ Now the focus can be placed on further reducing the risk of defined benefit plans and improving the offering and investment security of defined contribution plans like 401 ( k ) s .”
Additional key findings included that more than half of the executives surveyed said they are likely to offer lump sum distributions to defined
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