5 Key Impacts of Cincinnati Children's Pension Changes on Your Retirement

The existing pension plan at Children’s remains intact but frozen as of January 1, 2026. This means employees will keep the pension they’ve accrued, but it will no longer grow via company contributions. The pension is accessible at full value at age 65, with early withdrawals (before 65) resulting in a reduced benefit.

For example, a 55-year-old nurse with 15 years of service and a $90,000 salary would only have an estimated lump sum value of $165,000 at age 65. For highly compensated employees in their 50s or 60s, this means fewer options to roll over the pension into other retirement vehicles until they approach retirement age, limiting their flexibility in managing these funds.

To compensate for the frozen pension, Children’s is rolling out the Cincinnati Children’s Contribution Plan (CCC Plan), which represents a shift from defined-benefit to defined-contribution retirement plans. The CCC Plan introduces tiered contributions based on an employee’s years of service (YoS):

• 0-10 years: 5% of salary
• 10-15 years: 6%
• 15-20 years: 7%
• 20-25 years: 8%
• 25-30 years: 9%
• 30+ years: 10%

For employees with a long tenure, this plan becomes increasingly attractive as they approach the higher contribution tiers. The portability of the plan is another key advantage—unlike the pension, the funds can move with the employee should they leave CCHMC. Additionally, employees who meet the “55-point test” by the end of 2025 (where their combined age and years of service total 55) will receive an extra 4% contribution for five years, provided they remain full-time.

For employees in their 50s and 60s, the shift to the CCC Plan may initially feel like a setback, as they lose the steady growth of the pension. However, the CCC Plan offers new opportunities for retirement planning. Not only do they gain greater control over their retirement savings through investments in the plan, but they can also benefit from the plan’s flexibility and portability.

For those eligible for the additional 4% contribution, this could be a significant boost, providing an added incentive to remain employed at Children’s. Over time, these contributions can make a substantial difference in retirement outcomes, especially when combined with smart investment strategies within the CCC Plan.

While the pension freeze may cause concern, Children’s shift toward the CCC Plan aligns with broader trends in retirement benefits across industries. Defined-benefit pension plans are becoming less common as organizations move toward defined-contribution plans that offer employees more control and flexibility.

For older employees, this means the need for proactive planning is more important than ever. Financial advisors can help employees reassess their retirement goals, factoring in the frozen pension as a “fixed asset” for future income while optimizing contributions and investments in the CCC Plan. Additionally, employees should consider how to integrate the new Roth option within the 403(b) for tax-efficient growth in retirement savings.

For those affected by the pension freeze, now is the time to review your retirement strategy:

1. Understand your pension value: Know exactly how much your pension is worth today and how much it will be worth at full retirement age (65). This will help you plan for how it fits into your overall retirement income.
2. Maximize the CCC Plan contributions: Ensure you take full advantage of the new employer contributions, especially if you are eligible for the extra 4% contribution.
3. Optimize your 403(b): With the addition of Roth contributions, consider how this option could work within your broader tax strategy.
4. Plan for the long term: Given the reduction in guaranteed pension growth, it’s essential to make sure that your investments within the CCC Plan are working to support your long-term retirement goals.