Despite assertions that DC-type retirement schemes are less expensive than traditional pensions, research demonstrates otherwise, writes Brent McKim for the Louisville Courier Journal.
“A number of studies have found that, on average, the professional money managers that run (DB) pension plans significantly outperform novice individual investors making investment decisions with their 401(k)-style accounts. And, because  pensions include funds from thousands of plan members in one large pool, participating in a pension is like the investing equivalent of joining a wholesale club,” he writes.
“The large volume of funds pension plans invest allows them to negotiate lower commissions and fees than individuals in 401(k)-style plans, who have to pay full retail price. These two factors combine to generate about a 27 percent cost savings for pensions over individual 401(k) plans.”
More: advocates of efficient government should support traditional pensions.

ARIA provides a forum for an informed discussion on retirement income adequacy, and other related issues, including pension and retirement coverage, and defined benefit pension plans – ARIA pensions blog, 12 Dunlop Street, Barrie, ON, L4N 1V6 – sitemanager@ariapensions
About the Author

Hi. I am an experienced writer, editor, blogger and communications strategist, providing online and print content solutions