Plan sponsors will have one more year to use outdated mortalityassumptions in calculating pension funding requirements for2016.
|That will save sponsors about $18 billion in fundingrequirements this year, according to estimates from Moody'sInvestors Service.
|In 2014, the Society of Actuaries released newmortality tables, depicting Americans' longer lives.
|The tables had not been updated since 2000.
|The updated projections show the average 65-year-old male isexpected to live to 86.6, an increase of two years. The averagewoman is expected to live until 88.8, an increase of 2.4 years.
|Read: How best to communicate retirement planningto female clients
|In a note to investors, analysts at Moody's said the IRS wasexpected to require sponsors to apply the new mortality assumptionsthis year, but that the agency is still evaluating them and willnot apply the new numbers until 2017.
|“The dollar impact of this change will be substantial,” wrotethe analysts.
|At the end of last year, the non-financial corporations thatMoody's rates had a combined projected benefit obligation of $2.1trillion.
|Applying the updated mortality tables means a 6 percent, orcombined $126 billion increase in those obligations.
|The delay, and the $18 billion in funding obligations thatsponsors will save this year, is a “credit positive.” But Moody'salso warned the benefit to delaying the inevitable will do littlefor those plans facing systemic funding issues.
|BenefitsPro
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