How Much of Your Pension is Guaranteed By The PBGC

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[Chuum]

"A US Government Agency" basically says it all. With the constantly growing national debt, not even a glimmer of light at the end of that tunnel, and constantly incapable of even getting a federal budget approved without adding on so much pork spending that the nation is at high risk of a fiscal coronary. If it's there, fine. If not, those alternate assets and means of surviving without them is nice to have in place.

[joekuhnlovesretirement]

This PBGC works well for lower income employees. Once moderate income is achieved, the benefits are capped. I took a lump sum because I was insured for 24% !!!! My company reorganized to several LLCs to allow for bankruptcies of certain sectors. Scary. I want to control my destiny.

[mtm]

I agree with Joe's comment below, based on experience some friends have had going through bankruptcy. Folks in more senior positions get a big cut, including 100% of the amounts backed by the earnings of the Company, rather than the plan.

[edinnorthcarolina--ovelhog]

My airline pension was transferred to the PBGC in 2003. PBGC makes it easier for the bankruptcy judge to screw you over. Can you tell I'm still bitter after almost 20 years?

The big issues are no lump sum and no inflation adjustment. You are beholden to CONgress to keep the program funded.

Fortunately for me, I was halfway through my career and I was able to recover using my 401k. I retirement planned as if PBGC was not available.

[denisep.]

Excellent information! This is good to know. Thanks for covering this.