Kentucky to move all new hires to 401(k)-style plan

FRANKFORT, Ky. (AP) – Kentucky’s Republican leaders say they will close the state’s troubled pension system for most new employees, offering them a 401(k)-style plan as they seek to stop the bleeding in one of the country’s worst funded public retirement plans.

Gov. Matt Bevin and the state’s top two legislative leaders unveiled the plan Wednesday. It still must pass the state legislature, most likely during a special session Bevin plans to call before the end of the year.

Current workers would continue accruing benefits under the current system until they turn 65 or hit 27 years of service, when they would be moved into a 401(k)-style plan.

Kentucky is among many states struggling to pay retirement benefits. In June, Moody’s found the unfunded obligations for all public employees to be $4 trillion.

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10/18/2017 10:47:05 AM (GMT -4:00)

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