Pension Retirement Funds

Pension and Retirement Funds

When to Use

• Explain DB vs DC plan types, hybrids, and cash balance at overview level
• Frame funding policy, contribution strategy, and funded status metrics (corporate DB)
• Discuss liability measurement concepts: PV of benefits, discount rate, mortality, COLA
• Outline asset-liability management (duration, hedging, glide paths, liability-driven investing)
• Support plan design questions: benefit formulas, vesting, early retirement, optional forms
• Compare corporate, public sector, and multi-employer pension contexts (high level)
• Describe pension risk transfer: lift-outs, buyouts, annuities, longevity reinsurance
• Summarize US regulatory topics (ERISA, PBGC, DOL, IRS qualified plans)—not legal advice
• Explain fiduciary governance, investment policy, and institutional investor role of pension funds
• Support due diligence, board briefings, or transformation with pension domain context

When NOT to Use

• P&C insurance lines, underwriting, or claims → property-casualty-insurance
• Loss triangles, IBNR, insurance pricing/reserving methods, or appointed-actuary sign-off → actuary
• Actuarial consulting SOW, engagement governance, or M&A actuarial program management → actuarial-consulting
• Individual retirement planning, IRA rollovers, or personal wealth advice → financial-analyst (if installed)
• Contract interpretation, plan document legal disputes, or regulatory enforcement → commercial-counsel
• SOC 2 / ISO control mapping without pension operations context → compliance-engineer
• Executive strategy without pension/benefits domain detail → business-consultant

Related skills

Core Workflows

1. Engagement scoping

Before analysis:

1. Plan type — DB, DC, hybrid, governmental, multi-employer
2. Sponsor — Corporate, public, union, Taft-Hartley, church plan (note limitations)
3. Decision — Funding, design change, de-risking, accounting disclosure, governance review
4. Measurement basis — Funding (IRC/ERISA), GAAP (ASC 715), economic, solvency (public)
5. Jurisdiction — US federal/state; flag non-US for local counsel and standards
6. Materiality — Participant count, funded status, benefit richness, tail longevity risk

See references/pension_retirement_scope.md.

2. Plan structures (DB vs DC)

1. Map benefit promise (defined vs account balance) and sponsor risk allocation
2. Identify participant populations (active, deferred, retired) and data needs
3. Note hybrid features (cash balance, floor-offset, PEP/MPP DB/DC combos)
4. Separate 401(k)/403(b)/457 DC mechanics from DB accrual formulas
5. Escalate legal classification and document wording to commercial-counsel

See references/db_vs_dc_plan_structures.md.

3. Funding, liabilities, and ALM

1. State valuation date and purpose (funding, accounting, transaction)
2. Outline liability cash flows: benefits, timing, indexing, optional forms
3. Explain discount rate role (segment rates, full yield curve, market vs smoothed)
4. Summarize mortality and improvement assumptions at concept level
5. Connect assets to liabilities: funded ratio, duration, hedge ratio, glide path
6. Hand off detailed actuarial calculations to actuary when models are required

See references/funding_liabilities_and_alm.md.

4. Plan design and benefits

1. Document benefit formula (final average, career average, flat dollar)
2. Capture eligibility, vesting, service crediting, and breaks in service
3. Address early retirement subsidies, disability, and survivor forms
4. Flag COLA, lump sum, and cash balance conversion issues (overview)
5. Coordinate communications and amendment process with counsel and recordkeeper

See references/plan_design_and_benefits.md.

5. Risk transfer and de-risking

1. Clarify objective: balance sheet, volatility reduction, participant security, admin simplification
2. Compare LDTI/LDI, buy-in, buy-out, annuity placement, longevity reinsurance
3. List data, insurer/market, and fiduciary prerequisites
4. Outline transaction timeline and accounting/funding impacts at high level
5. Refer pricing, mortality, and liability sizing to actuary; legal docs to commercial-counsel

See references/risk_transfer_and_de-risking.md.

6. Regulatory, governance, and operations

1. Map ERISA fiduciary duties, IPS, and committee governance
2. Summarize PBGC premiums and termination concepts (corporate DB)
3. Note DOL reporting (Form 5500) and IRS qualification/testing at overview
4. Describe recordkeeper/custodian, payroll, and administration operating model
5. Label all regulatory comments as not legal or tax advice

See references/regulatory_governance_and_operations.md.

Key metrics (pension)

Always state measurement basis and assumption set in footnotes.

Data requests (starter checklist)

When the user has not supplied data, ask for:

1. Plan document summary or SPD highlights (not legal interpretation)
2. Census or participant counts by status (active, term, retiree)
3. Asset statement and allocation policy
4. Latest actuarial valuation (funding and/or accounting) with assumptions
5. Contribution history and funding policy
6. Prior board materials, de-risking studies, or RFPs

Deliverable standards

Always state uncertainty and limitations. Do not present outputs as legal, tax, actuarial opinion, or regulatory filing without qualified human review.

When to load references

• Scope and boundaries → references/pension_retirement_scope.md
• DB vs DC structures → references/db_vs_dc_plan_structures.md
• Funding, liabilities, ALM → references/funding_liabilities_and_alm.md
• Plan design and benefits → references/plan_design_and_benefits.md
• Risk transfer and de-risking → references/risk_transfer_and_de-risking.md
• Regulation and governance → references/regulatory_governance_and_operations.md