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PBGC Blog: Retirement Matters

Despite substantial economic and market gains, multiemployer pension plans covering about 1.5 million people are severely underfunded, threatening benefit cuts for current and future retirees, according to the FY 2013 Projections Report released today by the Pension Benefit Guaranty Corporation. By comparison, the financial situation for private single-employer plans, which cover about 30 million participants, is projected to improve.

Image showing multiemployer plans coverage

As required by the Employee Retirement Income Security Act, PBGC annually provides an actuarial evaluation of its future expected operations and financial status. The FY 2013 Projections Report (formerly called the "Exposure Report") released today provides a range of estimates of the future status of private pension plans and their effect on PBGC's financial condition, drawn from hundreds of economic scenarios.

A new AARP survey shows that health care, education, financial security and the digital divide are among the most important social issues for African-Americans ages 50 and older.

The national survey, which included phone interviews with 650 respondents, demonstrates that while many older African-Americans are optimistic that the country is moving in the right direction when it comes to issues such as health care, education and the digital divide, they are significantly less optimistic about finances, employment and workforce discrimination. Lower levels of optimism related to finances and employment could directly impact their future retirement security.

Having a financially secure retirement was considered the second most important issue (cited by 16% of those with multiple answers), while access to high quality education was the third most important issue (cited by 14% of those with multiple answers).

Complete survey results can be viewed on the AARP website.

Joshua Gotbaum sitting with Adam Shapiro

In part two of the Fox Business two-part series "Nationwide Retirement Crisis," PBGC Director Josh Gotbaum says millions of Americans have no retirement savings, calling the issue a national crisis.

In his interview, Gotbaum addressed issues concerning the existing retirement system, including:

  1. The existing retirement system is not covering most people,
  2. It doesn't lead to enough saving,
  3. And it doesn't lead to lifetime income.

People are living longer, healthier lives, which means retirement will cost more.

Watch the complete video interview on the Fox Business website.

Joshua Gotbaum sitting with Adam Shapiro

In part one of a two-part series, "Insuring Private Pensions," Fox Business reporter Adam Shapiro and Pension Benefit Guaranty Corporation Director Josh Gotbaum, discuss the need for Congress to raise premiums to ensure 42 million Americans receive the pensions they were promised.

By now, you may have read news headlines addressing a study on PBGC premium increases released by the Pension Coalition. In an official PBGC statement, Gotbaum responded saying, "Unlike the FDIC and other Federal insurance programs, Congress has continued to set PBGC premiums and has done so in ways that both underfunds PBGC and is convincing some companies they shouldn't offer pensions at all."

In his interview, Gotbaum explains the specific PBGC-related issues that affect the retirement crisis.

Watch the complete video interview on the Fox Business website.

Generic newspaperIn the recently published article "Thought Secure, Pooled Pensions Teeter and Fall," New York Times reporter Mary Williams Walsh gets candid commentary from PBGC Director Josh Gotbaum on the crisis facing the multiemployer pension system.

Gotbaum was quoted saying, "If Congress allows the PBGC to get the money and the authority it needs to do its job, then these plans can be preserved," he added. "If not, the PBGC will run out of money, too, and multiemployer pensioners will get virtually nothing. This is not something that can wait a few years. If people kick the can down the road, they'll find it went off a cliff."

Read the full article and find out more about multiemployer pension plans.

While we'd hope that you're using every day of every week to plan for your retirement, this week, April 7–11, 2014, has been designated as National Retirement Planning Week.

Organized by the National Retirement Planning Coalition — a group of prominent consumer advocacy and financial services organizations that are leading the charge to help Americans plan for retirement — this week represents a national effort to help consumers focus on their financial needs in retirement.

PBGC plays a role in this effort by protecting the retirement incomes of more than 40 million American workers in more than 26,000 private-sector defined benefit pension plans.

For informational resources, visit the National Retirement Planning Coalition's "Retire on Your Terms" webpage.