Generating a funding and investment strategy associated with an underfunded pension plan

A system for generating a funding and investment strategy associated with an underfunded pension plan, the system including a computing device with a processor configured to:

• determine an amount of funding required to fund an underfunded pension plan to a predetermined liability limit, wherein the amount of funding required is adjusted for (i) an expected return on pension plan assets, (ii) governmental premiums imposed on underfunded pension plans, and (iii) tax deduction amounts;
• determine periodic future non-debt-based contribution amounts for the pension plan;
• adjust the amount of funding required based on the future non-debt-based contribution amounts;
• determine an amount of debt to incur based on the adjusted amount of funding required;
• contribute the incurred debt amount into the pension plan as a pension plan asset;
• generate a strategic plan for investing the contributed pension plan asset in long-duration bonds, wherein the long-duration bonds have a higher yield curve than the incurred debt interest rate;
• acquire long-duration bonds that have characteristics consistent with the strategic plan;
• and
• during a subsequent period, adjust the future non-debt-based contribution amount so that the funding level of the pension plan meets but does not exceed the predetermined liability limit.

A computer program product, tangibly embodied in a non-transitory computer readable storage medium, for generating a funding and investment strategy associated with an underfunded pension plan, the computer program product including instructions operable to cause a computing device to:

• determine an amount of funding required to fund an underfunded pension plan to a predetermined liability limit, wherein the amount of funding required is adjusted for (i) an expected return on pension plan assets, (ii) governmental premiums imposed on underfunded pension plans, and (iii) tax deduction amounts;
• determine periodic future non-debt-based contribution amounts for the pension plan;
• adjust the amount of funding required based on the future non-debt-based contribution amounts;
• determine an amount of debt to incur based on the adjusted amount of funding required;
• contribute the incurred debt amount into the pension plan as a pension plan asset;
• generate a strategic plan for investing the contributed pension plan asset in long-duration bonds, wherein the long-duration bonds have a higher yield curve than the incurred debt interest rate;
• acquire long-duration bonds that have characteristics consistent with the strategic plan;
• and
• during a subsequent period, adjust the future non-debt-based contribution amount so that the funding level of the pension plan meets but does not exceed the predetermined liability limit.