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UPS/IBT pension funding
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<blockquote data-quote="35years" data-source="post: 2053131" data-attributes="member: 60822"><p><a href="http://www.benefitspro.com/2013/09/05/map-21-the-wrong-course-for-pension-plans" target="_blank">http://www.benefitspro.com/2013/09/05/map-21-the-wrong-course-for-pension-plans</a></p><p></p><p>"The change was a godsend to companies experiencing cash flow issues, allowing them to redirect cash otherwise destined for higher pension fund contributions to fund other, more immediate needs. As a result, many companies responded to the MAP-21 rule by lowering their pension contributions for 2012, some by double-digit percentages.</p><p></p><p>Pozen warned last year against companies relying too heavily on MAP-21 to solve their pension funding problems, saying that the 25-year averaging period went “too far,” and that somewhere in the neighborhood of five to 10 years would be more realistic.</p><p></p><p>Earlier this year, <a href="http://www.benefitspro.com/2013/01/09/declining-discount-rates-reduced-funded-ratio-of-p" target="_blank">Milliman warned</a> that, should interest rates remain low, keeping discount rates low, the only options open to companies would be strong market returns or larger contributions. In other words, companies that have availed themselves of MAP-21 to reduce plan contributions may have bought themselves some time but aren’t really better off than before."</p></blockquote><p></p>
[QUOTE="35years, post: 2053131, member: 60822"] [URL]http://www.benefitspro.com/2013/09/05/map-21-the-wrong-course-for-pension-plans[/URL] "The change was a godsend to companies experiencing cash flow issues, allowing them to redirect cash otherwise destined for higher pension fund contributions to fund other, more immediate needs. As a result, many companies responded to the MAP-21 rule by lowering their pension contributions for 2012, some by double-digit percentages. Pozen warned last year against companies relying too heavily on MAP-21 to solve their pension funding problems, saying that the 25-year averaging period went “too far,” and that somewhere in the neighborhood of five to 10 years would be more realistic. Earlier this year, [URL='http://www.benefitspro.com/2013/01/09/declining-discount-rates-reduced-funded-ratio-of-p']Milliman warned[/URL] that, should interest rates remain low, keeping discount rates low, the only options open to companies would be strong market returns or larger contributions. In other words, companies that have availed themselves of MAP-21 to reduce plan contributions may have bought themselves some time but aren’t really better off than before." [/QUOTE]
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