Ted Bauman is a member of Banyan Hill Publishing. He writes specialized columns dealing with making investments, immigration, and privacy. As the editor of several different columns at Banyan Hill Publishing, Ted Bauman tries to help people live a free and exciting life. To go hand in hand with that, Ted Bauman has done quite a bit of philanthropic work.
In one of Ted’s most recent articles, he compared the differences between a cash balance retirement plan and a traditional pension. Ted claims that there might be more to gain from a cash balance plan than there is from a pension. One of the main reasons for this is that employers that aren’t doing well often decide to simply stop paying their retired employees their pension. That can obviously end a person’s happy retirement rather quickly.
With a cash balance retirement plan, retirees receive money in a similar way to a pension, but without all of the risk. With a traditional pension, employees have to invest part of each of their checks into the retirement program and then they are eventually payed out at retirement age on a monthly basis. This can be an issue if the company is no longer around or in a financial crisis when you finally reach the age of retirement.