Professor Barnhardt: “So it was only when your world was threatened with destruction that you became what you are now?”Klaatu: “Yes.”Professor Barnhardt: “Well that’s where we are. You say we’re on the brink of destruction and you’re right. But it’s only on the brink that people find the will to change. Only at the precipice do we evolve.” -The Day the Earth Stood Still, 2008

One might paraphrase Professor Barnhardt’s plea, excerpted from the 2008 movie potboiler “The Day the Earth Stood Still,” to suggest that pension plans will evolve once it is clear to a sufficient number of participants that they are truly on the precipice.

In the private sector, where fewer laws shield employers and their workers from financial reality, evolution is well under way. And what has emerged is is a mutation of the Defined Benefit Plan that preserves many of its virtues, while avoiding most of the financial risks. Being pioneered by the east coast actuarial consulting firm,Cheiron, Adjustable Pension Plans can be structured in various ways, but all of them share certain… Read More