The Employee Retirement Income Security Act (ERISA) turns 50 this year and I didn’t buy them a gift or a cake.

Seriously, this law still serves as a framework for the retirement plan industry and despite some limitations, it’s been an overall success. It was promulgated because of the many failures of private pensions, Studebaker’s pension failure in 1963 where participants got 15 cents on the dollar, probably started the road to government reform. While many will claim that ERISA pushed defined benefit plans out of business, the need to guarantee employer contributions and sustainable benefits was there. Again, I believe pension plans were phased out because people are living longer and this expense by the employers is something they were willing to cut.

It’s all about protecting participant rights and I believe that ERISA has served well as a form of participant protection.