The World Bank launched a new cash balance plan to replace its frozen defined benefit plan.
Under the new plan, participants allocate contributions to passive investment options. But the money isn't invested in index funds. Instead, participants are promised the return of the indexes they choose. World Bank actively manages the underlying assets and pockets any return above that of the index.
Current employees will continue to be covered by the now-frozen $9.7 billion defined benefit plan and also accrue benefits under the existing benefits formula. New employees will participate in the new plan, which also will cover about 2,000 ``nonregular'' employees who have worked as consultants for years and whose contracts routinely are renewed.
