Converting Traditional Pensions Plans to Cash Balance Plans: Should You Do It?

Converting your firm's traditional pension plan to a cash balance plan will reduce pension expense. It will also help you attract younger, more mobile employees, since the plan is portable. But you'll be penalizing older employees for their loyalty to the company. Instead of receiving their traditional pensions, they'll end up with smaller ones. Some may even sue the company. So should you convert? The authors discuss the complex issues involved, and provide a checklist to help you decide. [ABSTRACT FROM AUTHOR]