Freezing a defined benefit pension plan doesn’t stop the risk of runaway costs or liability or even necessarily lessen it. It simply means the monthly pension benefit amount is fixed and no longer growing with service or pay. And whether the plan is soft frozen (closed to new participants) or hard frozen (no accruals for anyone), the plan sponsor must still fulfill its commitment for those frozen benefits.

At this point, the frozen plan stops being a recruitment or retention tool and instead becomes a purely financial obligation. That’s why it is important to carefully monitor the plan and the funding level to ensure participant benefits will be paid in full, while also minimising the cost to the plan sponsor.

Milliman consultants have a vast array of experience developing and executing detailed solutions and providing tools and guidance to plan sponsors of frozen pension plans, whatever the desired end-game is for the plan. We help you accomplish your unique time-critical goals for your frozen plans, including:

• A strategic approach to plan termination
• A structured implementation roadmap
• Automated tools to update and project funded status on a timely basis (up to daily)
• Tools for asset liability modelling and liability driven investing

To learn more about how Milliman can help with your frozen plan, please contact us.