Two Plans, One Integrated Program: The Next-Gen Retirement Framework

To help maximize the impact of their retirement spending, we believe organizations need to think beyond traditional defined contribution (DC) and defined benefit (DB) plans. An integrated retirement program can combine the value add of DC with the security of DB in a single strategy that aims to align participant outcomes, institutional investment capabilities, and enterprise objectives.

Key Takeaways

Move Beyond the DC–DB Tradeoff

An integrated program can capture the capital efficiency and risk-pooling of a DB plan with the transparency of the DC model, allowing organizations to harness the potential advantages of both.

Potentially Improve Retirement Outcomes

This framework may provide access to institutional investment strategies, greater contribution capacity, and more efficient retirement income solutions.

Potentially Increase the Productivity of Retirement Spend

This retirement framework aligns retirement spending to some of the most important outcomes, including workforce resilience, talent attraction and retention, capital efficiency, and organizational performance with no additional cost compared to the DC-only retirement model commonly used today.

The US retirement landscape is defined by two structurally imperfect models:

DC plans: While maximizing portability and administrative simplicity, these plans shift the burden of retirement security entirely to the participant. Employees are forced to assume the roles of chief investment officer, actuary, and longevity risk manager, a transition that has frequently resulted in systemic under-saving, restricted investment access, and a lack of viable mechanisms for efficiently converting accumulated wealth into lifetime income.
Legacy DB plans: While historically effective at delivering predictable outcomes, the traditional DB framework has become increasingly untenable for sponsors. Persistent asset-liability mismatches, historical interest rate volatility, and the lack of portability have transformed these pension obligations into volatile balance-sheet liabilities that many organizations can no longer sustain.

In a market defined by rigorous cost discipline, intensifying talent competition, workforce mobility, and heightened scrutiny of every major capital allocation, retirement spend deserves a more strategic test: What enterprise value is the organization buying with each retirement dollar?

Are retirement contributions optimizing capital efficiency?
Does the framework serve as a high-performance lever to attract, retain, and engage the workforce the organization needs?
Is retirement a legacy structure being maintained or a forward-looking lever of enterprise value?

While neither model in isolation fully addresses the complexities of the modern retirement landscape, the implementation of a hybrid retirement framework offers a compelling solution. By integrating the value-added attributes of DC plans with the security and professional management of DB structures, organizations can establish a “two plan, one program” framework that could help optimize participant benefits, enhances retirement outcomes, and maintains cost neutrality.

Two Plans, One Integrated Program: Stronger Retirement Outcomes

This new framework is not a return to legacy pensions; it is a new way of thinking to leverage optimal plan design that could lead to improved retirement outcomes. It allows the DC plan to serve the roles for which it is naturally suited (individual savings and flexibility) while the MBCB plan performs the roles for which DC is ill-equipped (centrally built investment portfolio and longevity pooling for retirement income).

The mandate is clear: design for effectiveness, communicate for action, govern for optimization, and measure for results.

We encourage you to download the full publication to understand why we believe enhanced DC is the next-generation retirement framework.

Connect with your Goldman Sachs Asset Management DC or DB Specialist to learn more about how we can create stronger retirement outcomes together.

Author(s)

Ernie Caballero

Managing Director

Michael Moran

Co-Head of Public Investing Market Insights

Chris Ceder

Senior Retirement Strategist

Two Plans, One Integrated Program: The Next-Gen Retirement Framework

Explore how an integrated DC and DB framework may help organizations strengthen retirement outcomes and improve capital efficiency.

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Date of first use: July 15, 2026