Happy Birthday ERISA

Brian Jebb

Last month was the 40th year anniversary of the Employee Retirement Income Security Act (ERISA), that strange and complicated Act that is the cornerstone of the US employee benefits system. Over its 40 year history, ERISA has been frequently expanded and amended.

While its focus has always been to protect plan participants’ benefits, ERISA will continue to evolve. Certain recent trends have become self-evident, especially the significant move from defined benefit plans to 401(k) defined contribution plans. The 401(k) plan seems to be the centerpiece of US retirement policy, despite that it is a non-guaranteed program that is contributory in nature. Its effect on the average employee without sufficient retirement income may lead to significant financial or legal changes in the future.

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