This amount is a combination of the employer’s share of normal cost plus the unfunded liability amortization payment. The contribution rate can be reported either in dollars or a percent of salary, Actuaries annually determine how much should be paid by employers in a given year in order to properly fund a pension plan. Examples of these assumptions are investment rate of return, inflation, payroll growth, mortality, retirement patterns, and other demographic data.Īctuarially Determined Employer Contribution (ADEC): The amount actuarially calculated each year that is required to be contributed by an employer to a pension plan’s pool of assets in order to ensure there will be enough funds to pay promised pension benefits. Unfunded Liability Amortization PaymentsĪctuarial Assumptions: Estimates used to forecast uncertain future events affecting future benefits or costs associated with a pension fund.
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