PBGC insures traditional pensions. So for years, we told people that we had nothing to do with defined contribution plans, such as 401(k)s.
But we're also interested in the retirement security of all Americans. That's why we're considering a program that would deal with the benefits of missing participants in terminated defined contribution plans.
We're looking for feedback from participants, employers, and retirement experts on the value of developing such a program. We need input on the scope of the problem of missing participants and the need for PBGC to take in the benefits and look for people.
Also, we want to understand the value of a database where people can search for their benefits, and the impact that a PBGC program might have on private companies that perform similar services.
According to the Department of Labor, in 2010, the most recent year available, there were more than 650,000 defined contribution plans with 88 million people. That same year, about 29,000 defined contribution plans, covering some 1.2 million people, terminated.
This effort would expand our finding an unclaimed pension search on the agency's website, where visitors can see if they're owed a traditional pension benefit from one of the failed plans PBGC assumed.
To make good decisions, and before we act, we're inviting the public to weigh in. You can submit your comments through email@example.com.
How PBGC is changing the narrative on Retirement Security
From J. Jioni Palmer, Director, Communications and Public Affairs:
J. Jioni Palmer
Director of Communications & Public Affairs
I've always been fascinated by storytelling: The Harry Potter series, This American Life, Grimm, The Twilight Zone, The New Yorker and just about anything by Walter Mosely. Books, movies, radio, print or online periodicals, fact or fiction, it doesn't matter. Interesting characters and a compelling narrative rivet me.
I also particularly like watching commercials and I'm constantly amazed by the brilliance of ad writers who can develop the scene, introduce relatable characters and tell a complete story in 30 or 60 seconds. Beyond hawking products or pushing ideas, I find commercials offer interesting insights on the zeitgeist of a particular demographic, culture or society.
Today, in almost any hour of evening television, sandwiched between myriad commercials for insurance companies and the latest solution to make housecleaning a breeze, you'll see spots about encouraging the viewer to plan for retirement.
One really resonates with me because it echoes a true story we at the Pension Benefit Guaranty Corporation tell a lot lately: people are living longer but retirement security isn't keeping pace. In the commercial, the narrator asks people to place a blue sticker along a timeline next to the age of the oldest person they've ever known. Not surprisingly, there are many dots ranging between 80 and 110. The spot closes with, "How do you make sure you have enough money to enjoy all of these years?"
Disclaimer: Neither the author nor PBGC endorses the products or services of the sponsor.
Since its inception in 1974, PBGC has been at the forefront of protecting the retirement security of the American people in defined-benefit pension plans offered by private companies. Now, most people probably don't know the agency exists, let alone think about us until the business they work for goes belly-up and they hear talk that the pension they've been looking forward to is about to evaporate.
Fortunately, PBGC does exist, and the safety net it provides allows most workers and retirees to keep the full promised benefit they've earned over many years.
PBGC will pay retirement benefits for more than 830 current and future retirees of Noble Health Systems Inc., which operates Noble Hospital, a 97-bed acute-care hospital in Westfield, Mass.
The agency stepped in because the hospital can't pay its pension obligations and remain in business.
PBGC will pay all pension benefits earned by the hospital's retirees up to the legal limit of $54,000 a year for a 65-year-old.
Retirees will continue to get benefits without interruption, and future retirees can apply for benefits as soon as they are eligible.
According to PBGC estimates, as of April 15, 2011, the pension plan was 61 percent funded with $28 million in assets to pay $46 million in benefits. The agency expects to cover $17.8 million of the $17.9 million shortfall.
Did you catch Director Josh Gotbaum's interview on C-SPAN? In case you missed it, we've got the details.
Josh spoke with Bob Litan, director of research at Bloomberg Government, about PBGC's efforts to safeguard the pensions of millions of Americans. Another trending topic Director Gotbaum spoke about: multiemployer pension plans and PBGC's multiemployer program.
Then, the conversation gained added insights from panelists Earl Pomeroy, Cary Franklin, Norman Stein, and Randy DeFrehn.
Together, the panelists and Director Gotbaum talked about the need for pension reform.
Check out Director Gotbaum's remarks on C-SPAN.
The month of May is declared as Older Americans Month! Sponsored by the U.S. Administration on Aging, this year's theme is "Unleash the Power of Age."
In President Obama's proclamation of this month of recognition, he noted, "As older Americans strive to lift up their neighborhoods, my Administration is working to make sure they get the tools they need to make a difference."
One of those tools that aid older Americans in being able to "unleash the power of age" and thrive after retiring from years of service is the ability to collect the monthly pension check they've earned.
The Pension Benefit Guaranty Corporation protects the retirement incomes of more than 44 million American workers. Eighty-five percent of retirees who receive benefits from PBGC receive the full amount of the promised benefit.
That's what makes the work of PBGC important — we're working to preserve pension plans and to make new plans possible for coming generations of older Americans, too.
As the days of the month pass, stay tuned for more from PBGC as we recognize and honor the contributions of older Americans!
In the meantime, we'd like to share a video about how PBGC works to protect pensions.
Almost everyone has a smartphone or tablet, and many popular websites and web apps are available in mobile versions. Well now, so is PBGC.gov.
It doesn't require a special link or access code. Simply visit www.pbgc.gov from your smartphone and you'll be redirected to the mobile version housing some of our most visited pages on the site. From the PBGC mobile version, you have full access to much of the same content that appears on our desktop version, including:
- Workers & Retirees
You can also perform searches and contact PBGC by phone or email with the simple click of a button.
If you want to opt out of viewing the site in the mobile format, that's simple too! Just click on the "Desktop Version" tab on the bottom of the screen.
Want to see how the mobile version of PBGC.gov looks? Go ahead, grab your smartphone, and visit www.pbgc.gov.