Managing Uncertainty: The Search for a Golden Discount-Rate Rule for Defined-Benefit Pensions

Summary:
Page Title:Managing Uncertainty: The Search for a Golden Discount-Rate Rule for Defined-Benefit Pensions – C.D. Howe Institute
Article Title:Managing Uncertainty: The Search for a Golden Discount-Rate Rule for Defined-Benefit Pensions
URL:https://cdhowe.org/publication/managing-uncertainty-search-golden-discount-rate-rule-defined-benefit-pensions/
Published Date:January 31, 2019
Accessed Date:February 7, 2025

Public-Sector pensions are using risky projections to calculate their future liabilities, according to a new report from the C.D. Howe Institute. In “Managing Uncertainty: The Search for a Golden Discount-Rate Rule for Defined-Benefit Pensions,” authors Stuart Landon and Constance Smith find that many pension plans use high discount rates that increase the risk they will have insufficient assets to meet their future obligations.

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