A word of warning to 401(k) plans: Get ready to move over. Conditions may soon be ripe for traditional pension plans to stage a comeback, according to a new white paper from Pentegra Retirement Services.
The report argues that the economics that drove up the costs of defined benefit plans - the traditional pension plans of yesteryear - are showing signs of slowing down and reversing themselves. Historically low interest rates, the biggest culprit in the run-up in pension costs, "appear to have nearly hit bottom and are poised to now begin rising as soon as the Federal Reserve suspends the accommodative support of growth through an expansionary monetary policy," the report says.
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