<h2>Redefining Defined Benefit Pensions<a href="http://www.professorhollybell.com/wp-content/uploads/2012/09/ID-10049304.jpg"><img class="alignright size-medium wp-image-1891" title="ID-10049304" src="http://www.professorhollybell.com/wp-content/uploads/2012/09/ID-10049304-300x243.jpg" alt="pensions"width="300" height="243" /></a></h2> By Holly A. Bell For most people in the private sector, defined benefit <b>pensions</b> have become a distant memory. Something their grandfather talks about over Thanksgiving dinner while reminiscing about his days at "the plant". These plans, which guaranteed a certain percentage of a worker’s wages or salary in retirement, have been replaced with defined contribution plans like 401(k)s. However, is it possible that a defined benefit hybrid model based on employee contributions might be a better, yet equally sustainable model? There were several reasons traditional defined <i>pensions</i> proved to be unsustainable: Built in cost-of-living increases, benefit rates up to 90 or even 100% of annual earnings, earnings calculations based on the highest five years of earnings, the inclusion of generous health insurance benefits, early retirement ages (and longer life expectancy), inadequate funding or companies raiding pension funds, high return
