Did your Pension Plan get taken over by PBGC?

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Murdock7591
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Did your Pension Plan get taken over by PBGC?

Post by Murdock7591 » Fri Mar 15, 2019 10:05 am

I was wondering if anyone was receiving a retirement (monthly) pension through their past employer and then that employer pension plan
went belly-up and they were switched to PBGC?
Did they receive the same monthly amount from PBGC as they were getting from their employer's plan?
This relates to a Single Employer Pension Plan as defined at PBGC.

Boglegrappler
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Re: Did your Pension Plan get taken over by PBGC?

Post by Boglegrappler » Fri Mar 15, 2019 10:25 am

My understanding of the PBGC is that your benefit will not change if PBGC takes over the plan, unless your benefit is above the "insured" level


I think there is some mild complexity in this, but here's a link to a page that might help.

https://www.pbgc.gov/wr/benefits/guaran ... -guarantee

If your pension level is on the high side, you could see a reduction.

I have a PBGC pension that happened because the old plan had no administrator willing to administer it, and, despite being essentially fully funded, it was taken over by PBGC. My level is below the guarantee level. I just waited until I was ready to collect and then they send you the forms, and it all worked out ok. They were helpful in doing calculations of what the payment would be if I waited a couple of years.

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bengal22
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Re: Did your Pension Plan get taken over by PBGC?

Post by bengal22 » Fri Mar 15, 2019 11:38 am

Murdock7591 wrote:
Fri Mar 15, 2019 10:05 am
I was wondering if anyone was receiving a retirement (monthly) pension through their past employer and then that employer pension plan
went belly-up and they were switched to PBGC?
Did they receive the same monthly amount from PBGC as they were getting from their employer's plan?
This relates to a Single Employer Pension Plan as defined at PBGC.
1. Yes
2. No - 75 percent
"Earn All You Can; Give All You Can; Save All You Can." .... John Wesley

Valuethinker
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Re: Did your Pension Plan get taken over by PBGC?

Post by Valuethinker » Fri Mar 15, 2019 11:49 am

Murdock7591 wrote:
Fri Mar 15, 2019 10:05 am
I was wondering if anyone was receiving a retirement (monthly) pension through their past employer and then that employer pension plan
went belly-up and they were switched to PBGC?
Did they receive the same monthly amount from PBGC as they were getting from their employer's plan?
This relates to a Single Employer Pension Plan as defined at PBGC.
For the PBGC multi-employer fund, there is a serious issue with solvency. The PBGC itself warns of that on its website, I believe. Cash flows out exceed cash flows in. AFAIK there's been no move for legislative bailout*. It's a situation to watch very carefully and one situation where I would suggest it might be best for the pension plan member to withdraw his or her money if possible (take a lump sum) - there are a lot of retired Teamster truckers whose pensions are at risk.

I am not US based but this is my understanding of the situation.

* given that these are typically blue collar workers (an important electoral demographic for both sides) one might argue that some kind of bailout is likely. That's beyond the scope of this Forum.

Topic Author
Murdock7591
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Joined: Fri Oct 05, 2018 6:48 am

Re: Did your Pension Plan get taken over by PBGC?

Post by Murdock7591 » Fri Mar 15, 2019 12:28 pm

bengal22 wrote:
Fri Mar 15, 2019 11:38 am
Murdock7591 wrote:
Fri Mar 15, 2019 10:05 am
I was wondering if anyone was receiving a retirement (monthly) pension through their past employer and then that employer pension plan
went belly-up and they were switched to PBGC?
Did they receive the same monthly amount from PBGC as they were getting from their employer's plan?
This relates to a Single Employer Pension Plan as defined at PBGC.
1. Yes
2. No - 75 percent
Are you under the "PBGC multi-employer fund" or the "PBGC Single Employer Pension Plan"?
My monthly amount will be $2400, which according to the PBGC tables is below the Maxi limit for my age.
Was your monthly amount over the PBGC max limit for your age?

Mr.BB
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Re: Did your Pension Plan get taken over by PBGC?

Post by Mr.BB » Fri Mar 15, 2019 12:45 pm

My wife's pension plan was. Basically her future payouts were cut in half, and even though she is earning more now the future monthly pension will not increase.
"We are what we repeatedly do. Excellence, then, is not an act, but a habit."

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bengal22
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Re: Did your Pension Plan get taken over by PBGC?

Post by bengal22 » Fri Mar 15, 2019 12:50 pm

Murdock7591 wrote:
Fri Mar 15, 2019 12:28 pm
bengal22 wrote:
Fri Mar 15, 2019 11:38 am
Murdock7591 wrote:
Fri Mar 15, 2019 10:05 am
I was wondering if anyone was receiving a retirement (monthly) pension through their past employer and then that employer pension plan
went belly-up and they were switched to PBGC?
Did they receive the same monthly amount from PBGC as they were getting from their employer's plan?
This relates to a Single Employer Pension Plan as defined at PBGC.
1. Yes
2. No - 75 percent
Are you under the "PBGC multi-employer fund" or the "PBGC Single Employer Pension Plan"?
My monthly amount will be $2400, which according to the PBGC tables is below the Maxi limit for my age.
Was your monthly amount over the PBGC max limit for your age?
1. Single
2. Not sure.
"Earn All You Can; Give All You Can; Save All You Can." .... John Wesley

Topic Author
Murdock7591
Posts: 19
Joined: Fri Oct 05, 2018 6:48 am

Re: Did your Pension Plan get taken over by PBGC?

Post by Murdock7591 » Fri Mar 15, 2019 12:54 pm

Mr.BB wrote:
Fri Mar 15, 2019 12:45 pm
My wife's pension plan was. Basically her future payouts were cut in half, and even though she is earning more now the future monthly pension will not increase.
Was she in a PBGC multi-employer fund?
Was she retired from that company and receiving a monthly pension before PBGC took over and cut down that monthly amount?

Mr.BB
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Joined: Sun May 08, 2016 10:10 am

Re: Did your Pension Plan get taken over by PBGC?

Post by Mr.BB » Fri Mar 15, 2019 2:00 pm

I don't know what a multi-employer fund is. She is working for a single company all these years and is still there working.
"We are what we repeatedly do. Excellence, then, is not an act, but a habit."

Yooper16
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Re: Did your Pension Plan get taken over by PBGC?

Post by Yooper16 » Fri Mar 15, 2019 3:56 pm

I do have a pension waiting at PBGC, from an employer who went under in 2002. They had ended the defined bene pension around 1990 and it was fully funded at time of bankruptcy. None of the funding was in corporate stock or bonds.

I will be receiving the same amount as originally projected in 1990 estimates. I do have the option of deferring until ago 70 (2024) and get a higher $$. Spouse can also inherit using multiple formulas. Really was a nice pension program.

123
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Re: Did your Pension Plan get taken over by PBGC?

Post by 123 » Fri Mar 15, 2019 9:05 pm

My understanding is that if the PBGC takes over a pension plan the agency only pays monthly pension benefits, it does not offer a lump sum payout alternative.
The closest helping hand is at the end of your own arm.

Carl53
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Re: Did your Pension Plan get taken over by PBGC?

Post by Carl53 » Sat Mar 16, 2019 8:07 am

When I retired over 10 years ago, I took two pensions from different portions of the same company in an accelerated fashion (about 40-45% extra until age 62) as I expected the company to go bankrupt and that the pensions would get flipped to the PBGC and I would get much less. The company lasted until 2014, a year later than I expected. What I have been pleasantly surprised with is that although it went bankrupt the pensions and cadillac health plans have continued despite corporate folks being allowed huge lump sum payouts (I presume to preclude potential PBGC haircuts). I am at an age now that the post 62 (reduced to a little more than half of the pre-62 benefit) pensions would be covered by PBGC should they go under. I still get a stipend towards medicare supplemental insurance and my younger spouse (the one with most of the health issues) is covered by the cadillac plan. Every month I open the pension payment statements to check to see if any notification regarding the health plan termination is present and time after time I am delighted to see that another month is covered. When it happens, we'll have an additional expense, but have had six years of coverage beyond what I included in my retirement planning, not to mention never having the pension reduced.

Topic Author
Murdock7591
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Re: Did your Pension Plan get taken over by PBGC?

Post by Murdock7591 » Fri Jul 12, 2019 6:10 am

Looking into it further what I see: If PBGC takes over my Single Employer Pension, I should get my full amount since it is under the maximum for my age 62.
Concerns arise if it is an Multi Employer Pension (which it is not) or if my monthly pension is over the 2019 maximum amount for my age. (which it will not be)
Do anyone see things differently?

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