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Participants in the dark about lump-sum payouts, GAO says

Consumer advocates worry that participants potentially face a reduction in their retirement assets when they accept a lump-sum offer.

By Nick Thornton | Updated on February 26, 2015

Pension-plan participants often receive too little information when they’re offered a lump-sum payment that replaces their lifetime benefits, according to a report from the Government Accountability Office. 

Sponsors, especially those with underfunded pensions, have been turning to lump-sum payments in greater numbers in the past few years, prompting Rep. Sander Levin, D-Michigan, ranking member of the House Committee of Ways and Means, and Rep. George Miller, D-California, who’s now retired, to ask the GAO to review the trend. 

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Nick Thornton

Nick Thornton

Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.

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