The Pension Benefit Guaranty Corporation (PBGC) recently reported that they are holding approximately $197 million in unclaimed pension benefits from private employer pension plans that have been terminated. The PBGC is the federal entity that was created to protect and guarantee retirement benefits for defined benefit pension plans offered by private companies.
Although not as common as they once were, defined pension plans are retirement plans offered by private companies that pay a fixed, monthly amount of money to an employee when they retire. The monthly benefit paid is typically based on the employee’s salary and number of years worked at that company. When a company terminates its defined pension plan - usually because the company merged or was acquired or if the company experienced financial distress such as bankruptcy, the PBGC would step in to ensure that the participants of those plans receive a basic level of retirement benefits. The PBGC pays participants of terminated plans with funds collected from the companies with defined pension plans (in the form of insurance premiums), the proceeds generated from its investments, and the funds from terminated plans.
The PBGC is currently paying retirement benefits to almost 750,000 workers and has unclaimed benefits of $197 million owed to approximately 36,000 people. If you want to check to see if you are one of the 36,000 people who are owed any of these unclaimed benefits, use the PBGC’s Pension Search directory at http://search.pbgc.gov/mp/. This search service is free of charge and available 24 hours a day.
For more information about unclaimed pension benefits and how to find them, the PBGC offers additional tips, suggestions, and resources in their “Finding A Lost Pension” booklet available at www.pbgc.gov/docs/Finding_A_Lost_Pension.pdf.
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