Waiting for rates to rise?
The efficacy and timing of de-risking moves often comes down to where you think interest rates are going.
The conventional wisdom for years now is that rates are heading up, and most think that pulling the trigger on buying annuities and/or offering lump sums is just not a good idea. Why? Because as rates go up the price of Single Premium Group Annuities (SPGAs) go down. Likewise, the cost of lump sums.
This conventional wisdom has largely proven wrong over the past decade as rates have continued a long trend downward.
Rationale for Retiree Lift-outs in the age of historically low interest rates. Ten reasons to consider:
Pennies on the dollar can reduce pension risk transfer costs after PBGC cost savings are taken into account.
Most companies are aware of the increasing costs of PBGC premiums. Add to these the ongoing costs of plan administration, actuarial and legal, and it becomes apparent that the costs of servicing pension plan debt can be reduced with a restructuring. Especially when termination and de-risking moves can remove these costs permanently.
Raymond James’s PRT Group and CESCrews
The Raymond James Pension Risk Transfer (PRT) Group brings a national presence with highly experienced advisers in your area. CES-CREWS systems and consultants bring what’s needed to complement these advisers and provide proactive results to plan sponsors. For more information contact:
Craig Johnson, ChFC®
Dusty Johnson, CFP®, AIF®
(888) 520-7526 / Website
(502) 569-4116 / Website
(516) 364-7489 / Website