July 24, 2014
The economic downturn has kept HR managers busy with questions from employees concerned about their retirement. Managers have had to field questions about what the crisis means for employees seeking to retire soon and even those who have many years before they hang it up. A paper by the Center for Retirement Research at Boston College, "The Financial Crisis and Private Defined Benefit Plans," can be helpful for HR professionals whose companies offer defined-benefits plans. The paper has a big-picture view of the impact the crisis can have on pensions, and that information may be useful in helping employees sort through their concerns. The document "explores what a loss of roughly $1 trillion of private sector defined benefit equities means for the individual participants and for the firms that sponsor those plans." The center says that in just one year, from October 9, 2007, to October 9, 2008, the value of equities in retirement plans dropped by $4 trillion.