Cashflow shortages - the implications

clock

As schemes mature, it's more likely that they will become forced sellers of assets irrespective of how well funded they may be. Understand and plan your cashflow requirements or you might get bitten!

It has been reported recently that half of local authority schemes risk having a cashflow shortfall. However, this is an issue for consideration by most private sector pension schemes as well. As schemes mature, the higher monthly benefit payments and reduced contribution income from those accruing benefits inevitably makes it more likely that schemes will become forced sellers of assets irrespective of how well funded they may be.

This is a significant point. Imagine the scenario where a scheme is fully funded on a scheme funding basis but finds itself cashflow negative and expects to remain so for some time.  There are two options…

To read the rest of the blog click here:
http://www.woollysblog.com/cashflow-shortages---the-implications.aspx?utm_source=ppe&utm_medium=extcommvp&utm_campaign=blog

More on Industry

Revised figures show zero UK real GDP growth in Q3

Revised figures show zero UK real GDP growth in Q3

Revised ONS figures

Sorin Dojan
clock 23 December 2024 • 1 min read
Isio achieves 'record' year for risk settlement business

Isio achieves 'record' year for risk settlement business

Organisation predicts ‘sustained’ growth in BPA market

Holly Roach
clock 20 December 2024 • 2 min read
UK Pensions Awards 2024 - Winners' Supplement

UK Pensions Awards 2024 - Winners' Supplement

Celebrating excellence in pensions

Professional Pensions
clock 20 December 2024 • 1 min read
Trustpilot