Selection among employer-sponsored pension plans: The role of individual differences

Recognizing the explosive growth and increasing importance of alternative f orms of retirement plans, this study investigated determinants of employees ' choice among the three major types of employer-sponsored pension plans: d efined benefit, defined contribution, and hybrid cash balance. Using a held survey of 2,400 employees who participated in a state sponsored retirement system covering 60 participating employers, we tested a general model of p ublic employee pension choice, and examined the: roles of plan feature pref erences, employee attitudes, and demographics in pension plan participation choices. The results identified primary predictors distinguishing plan sel ection and indicated that employees' preferences for plan features explaine d significant variation in their selection among pension plans. The results challenged the conventional wisdom regarding the nature of pension plan ch oice and highlighted the critical role played by individual differences.