NCTR Chief Shares Why DC Plans are "Inadequate" for Retirement Security

Over the last 25 years, the pendulum in the public pension industry has been swinging from Defined Benefit (DB) plans to Defined Contribution (DC) plans. Powerful advocates in the government and financial sectors have proclaimed that DC plans are the key to reforming a broken pension industry, regardless of the state of the economy. In a bear market, DB plans are unsustainable they say. They put state and local agencies on the path to inevitable failure. On the other hand, in a bull market, DC plans significantly outperform DB plans. Why wouldn’t a pension fund want to follow the DC model?

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