Pension Plan Executives Need to Plan Ahead for New Mortality Tables

Pensions & Investments

The IRS will be updating mortality tables by 2018 and financial executives will likely be facing changes in their contribution requirements, paying premiums, and deciding whether or not to make lump-sum distributions to former employers. CEOs and other internal executives should familiarize themselves now with the impact of mortality tables on a plan’s funded status and coordinate with external stakeholders, says Greg Meila, senior investment director at Cambridge Associates, based on the firm’s research findings that infer the expected average mortality improvements of two to three years should trigger a 4% to 8% drop in reported funded status.

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Read Cambridge Associates’ research report by senior investment director Greg Meila for more insights and analysis, “Thought Mortality Was Dead? Considerations for Pensions Given the IRS’s Delay in Implementing RP-2014.”