Annuities take the place of defined-benefit plans at some firms

Some companies are looking at instituting a defined-contribution plan to take the place of defined-benefit plans, which are being phased out. "Many of our employees knew someone who had a pension, and they wanted a pensionlike investment," said Will Kuchta of Paychex, which recently introduced an annuity option to its 401(k) plan. Some large firms, however, say the size of the financial responsibility and the lack of guidance are off-putting. A survey by Towers Watson found that about 2% of 401(k) plans include an annuity option.

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