Pensions including municipal Police and firefighters at risk due to Markets_This means you will work till you drop

A QUIRKY ACCOUNTING tool used to smooth out swings in financial markets may end up giving traditional pension plans and the local governments who use them post dot-com hangovers.

Pensions, like the newer and more popular 401(k) accounts, rely on stock market investments to help pay benefits

for retiring employees. Unfortunately, the nearly three-year stock arket slide has caused losses in those pension funds and 401(k)s.

"With the markets doing as lousy as they have, we have had lousy returns," says Richard Hampton, chief executive officer of New Orleans Fire Pension. "We are just like every other pension in the country. When the markets lose money, we lose money."

In traditional pension plans, also known as guaranteed benefit plans, an employer is obligated to pay a fixed monthly dollar amount after a worker retires.

"With 401(k)s, you don't have a problem with funding because no benefit is promised," says Dwayne Littauer, an attorney and immediate past president of the Association of Employee Benefit Planners of New Orleans. "Whatever is put in is what you get."

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