Taking Risk OFF Your Clients’ Balance Sheets

There’s a lot of liquidity in the markets today. And as financial advisors, we have the challenge of finding opportunities in what, on many corporate balance sheets, appear to be a liability.

Currently, the S&P shows assets of $4 trillion on company balance sheets. This causes us to wonder what those assets are being used for, since it’s not for research and development or to expand the workforce. And it caused me to wonder how we can use those assets to better companies and improve the retirement success of employees of those S&P companies. 

One of the best ways to do that is to start talking about pension risk transfers—the same pension risk transfers that, years ago, were just a footnote on a balance sheet. In reality, the Pension Protection Act becomes a liability on every balance sheet, whether the company is corporately owned, publicly traded or closely held. It’s important that we recognize that that liability can be shored up through several different techniques.

The most important technique we can employ is to transfer that risk to an insurance company, allowing us to take it off the balance sheet. With so much unused cash that may have a short-term hit to the balance sheet, and no ongoing contributions to long-term, it can seem like running a treadmill, never being able to catch.

Our pension liabilities were putting that to good use, shoring up pension plans on promises made 20 years ago. And, in addition to securing retirement, you’ll be able to help employee morale in what continues to be a difficult time for both employees and companies alike.

Reach out to our retirement income consultants to learn more about pension risk transfers, as well as rollover options for many retirement accounts. Call us at (800) 589-3000.

Transformational Tactic

It’s time to start talking about pension risk transfers. Not only can you transfer risk to the retirement company, you can increase employee morale at the same time.

Recognize the opportunity to transform your business by taking our free course.