OKLAHOMA CITY (AP) — The Oklahoma House has approved a bill to create a defined contribution option for state employee retirement benefits.
The proposal would allow state employees hired after July 2014 to choose between the defined contribution option and the current defined benefit system. The House approved the bill 72-20 Tuesday, sending it to Gov. Mary Fallin.
A retiree's benefits from a defined contribution plan like a 401(k) often depend on the performance of the retiree's investments and the economy. Because of this, the plan is generally considered riskier than a stable defined benefit plan.
Republican Rep. Randy McDaniel sponsored the bill and says it would bring mobility and freedom to state workers' retirements. McDaniel also works as a financial planner.
Democratic Rep. Richard Morrissette says retirement and risk shouldn't go together.