Cash balance pension funds tend to favor young workers, while they may actually reduce older workers benefits.

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Cash balance pension plans convert a worker's future pension benefits into a hypothetical account balance, which grows each year with new credits and an interest credit. This structure can result in younger workers accumulating benefits more rapidly due to the longer period for interest compounding, whereas older workers, who have less time until retirement, may see a reduction in benefits compared to traditional defined benefit plans that are more back-loaded.

Cash Balance Pension Funds Tend to Favor Young Workers, While