Forty years after the passage of the Employee Retirement Income Security Act – ERISA – it seems like we are far removed from the issues it attempted to address. 

In 1974, 40% of private sector employees were covered by employer-sponsored defined benefit pension plans. These DB plans provided workers with a lifetime income annuity upon retirement. These plans provided a high level of income security – if the employer met funding requirements. 

However, many of these plans were only partially funded and plan failures were not uncommon. ERISA required tighter funding requirements for these plans, thus improving workers' income security. A more fully funded plan was more likely to meet future obligations.

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