It may sound like a radical idea that goes against current trends. "Clearly, there has been a long-term trend of employers moving away from defined benefit plans to defined contribution plans," Coffing acknowledges. But that's not necessarily a good thing for plan sponsors or retirees. "The challenges of relying solely on defined contribution plans are becoming evident," she says.
At the very least, it's an option that should not be overlooked. "For many sponsors," says Coffing, "the SIP does a good job of meeting both participants’ need for secure lifelong income [and] the sponsor’s need for stable, predictable contribution requirements."