Post-retirement health care costs may swamp corporations

Article Abstract:

Companies with significant numbers of retirees are finding it increasingly difficult to maintain retiree medical benefit plans. Some 25% of persons older than 65 have some form of employer-subsidized medical benefits. Expenses are high and a cash flow squeeze is expected for the next 20 to 50 years for these companies. The Financial Accounting Standards Board intends to require companies to recognize such liabilities on their balance sheets. Furthermore, the IRS prohibits tax deductions for money used to pre-fund post-retirement benefits. Congress may pass legislation to treat post-retirement benefits in the same way as pensions are now treated, requiring a vesting schedule.

Analysis, Finance, Medical care, Cost of, Health care costs, Retirement benefits

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Pension funds venture into venture capital investment wilds

Article Abstract:

Pension fund managers and corporate treasurers are looking into the venture capital field to invest funds. High-risk funds are normally off-bounds for pension funds, but many of the venture capital funds are safer than commonly thought. These funds can return 20% annual compounded yield after management fees. They are usually diversified and not all of them specialize in new start-ups. Some venture capital funds include older firms that have not gone public yet. Several noted firms include Hambro International Venture Fund, Prudential Venture Capital Inc, and Venture Economics.

Investments, Venture capital companies, Pension funds

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