What If Your Pension Ends?

What happens if your pension ends?

At a time when companies are going bankrupt or just going out of business, pensions are not ironclad. If you feel your pension may end, take a look at what the Pension Benefits Guarantee Corporation, a government agency, has to say about your rights.

This is important stuff because if you want money from a reverse mortgage to go along with a pension, you surely need the pension. A pension reduction could radically reduce your income and lifestyle, so read the PBGC material below with care.

1. Look for official notification

If your employer wants to end the plan, your plan administrator must notify you in writing that your plan is ending. You must get this notice, called the Notice of Intent to Terminate, at least 60 days before the “termination” date.

If PBGC is terminating the plan, we notify the plan administrator and often publish a notice about our action in local and national newspapers.

*In a standard termination, you should receive a second letter describing the benefits you will receive, called the Notice of Plan Benefits, generally no later than six months after the date proposed for your plan’s termination.

*In a distress termination, or a termination initiated by PBGC, our communication with you begins when we take over your plan as trustee. Initially we will provide you with general information about the pension insurance program and our guarantees.

We will be able to provide more specific information about your benefits after we have had an opportunity to review the plan’s records, assets, benefit liabilities, and your participation in the plan.

2. Complete all requests for information promptly

PBGC reviews your plan’s records to determine what benefits each person will receive. To ensure PBGC has the correct information, we will ask you to complete an information form.

*If you are already receiving pension benefits from your pension plan we will ask you to complete the Participant Information Form. (If you are already receiving a pension, we will continue paying you without interruption during our review. These payments will be an estimate of the benefits that PBGC can pay under the insurance program, and they may be less than you were receiving from your plan.)

*If you are not yet receiving pension benefits we will ask you to complete a Beneficiary Designation (not currently receiving pension benefits) Form.

Please return your information form to PBGC within 30 days of receipt.

3. Review information on benefits information

Review the “Your Guaranteed Pension” brochure included in our first mailing or explore the topics on our website:

What PBGC guarantees

Maximum monthly guarantee tables

PBGC payments

Payments to beneficiaries

Benefits for disabled participants

Domestic relations orders

Health insurance assistance

State life and health insurance guaranty association offices

Also, review the information on a special webpage we set up for each pension plan we trustee. Find your plan’s page.

4. Look for information meetings held by PBGC

In some cases, PBGC will hold meetings with participants to provide you with information about PBGC and discuss how we will process your benefits.

Meeting announcements will be posted on your plan’s webpage. Find your plan’s page.

This entry was posted on Thursday, November 1st, 2007 at 3:31 pm and is filed under Reverse Mortgage . You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.