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PBGC Blog: Retirement Matters

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Millions of Americans take advantage of direct deposit. Whether it's their payroll checks, tax refunds, or benefit payments, many are opting out of paper checks and opting in to convenience.

We want you to know that PBGC offers that same convenience.

Undecided about whether you should switch to direct deposit? Our most recent studies show:

  • 8 out of 9 payment delays affect people who get paper checks
  • More than one in every 200 paper checks is delayed, usually because of postal issues

Paper checks can also be lost or stolen.

More...

Sack filled with hundred dollar billsAcross the country, there are more than 38,000 people who haven't claimed pension benefits they are owed. Those unclaimed pensions equal a total of over $300 million dollars, with individual benefits ranging from twelve cents to almost a million dollars.

The states with the most missing pension participants and money to be claimed are:

  • New York (7,031/$42.38 million)
  • Illinois (4,129/$79.63 million)
  • California (3,082/$8.52 million)
  • Texas (2,487/$12.32 million)
  • New Jersey (2,288/$12.84 million)
  • Ohio (2,109/$15.22 million)

More...

If you receive a retirement benefit from PBGC, all or some of the money may be taxable. Every year, we report this amount to the IRS and send you an IRS Form 1099-R that states the amount we paid you the previous year.

We'll mail your Form 1099-R for 2012 to your address of record by Thursday, January 31, 2013. If you don't receive your form soon after January 31, 2013, you may use the options below to request a duplicate 1099-R, as early as February 1.

  1. Use our online service, MyPBA, to view and print a copy of your 1099-R tax form for the most recent tax year. 

OR

  1. Call PBGC's Customer Contact Center to request a form by mail. The number is 1-800-400-7242.

Before you call, please have your Social Security number, plan name and case number ready for the customer service representative.

'Don't Believe the Myths'

  |   December 10, 2012

Whether retirement is knocking on your door or decades away, you should have a financial plan in place to help you reach that milestone. Bloomberg Business News published an article that debunks some of the myths about retirement. As the article states, "We're living increasingly in a "yoyo" economy -- short for "you're on your own."

According to the article, here are some of the most common myths about retirement:

MYTH NO. 1: It's OK to postpone saving for retirement until other needs are taken care of.

MYTH NO. 2: Medicare will take care of almost all your health care needs.

MYTH NO. 3: You'll need far less income in retirement to maintain the same standard of living.

MYTH NO. 4: You can claim Social Security early and still get full benefits later.

MYTH NO. 5: You should rely heavily on bonds rather than stocks as you get older.

MYTH NO. 6: Any retirement target-date fund will allow you to "set it and forget it."

MYTH NO. 7: You'll be able to make up a savings shortfall by retiring later or working part-time in retirement.

Read the full article, "7 retirement planning myths debunked."

PBGC will pay retirement benefits for more than 1,300 current and future retirees of RG Steel, the nation's fourth-largest flat-rolled steel producer with steelmaking facilities located in Sparrows Point, Md.; Warren, Ohio, and Wheeling, W.Va. Additional finishing facilities are in Yorkville and Martins Ferry, Ohio.

RG Steel and its seven affiliates are liquidating in bankruptcy. PBGC has trusteed the two pension plans RG sponsored - the RG Steel Warren, LLC Hourly Employees Pension Plan ("Warren Plan") and the RG Steel Wheeling, LLC Pension Plan ("Wheeling Plan"). 

In bankruptcy, RG Steel has sold practically all of its assets.  Most of the buyers are liquidators, none of which assumed the pension plans.  PBGC initiated termination because of RG Steel's liquidation in bankruptcy and the forthcoming abandonment of the pension plans. More...

A commonly asked question is how does PBGC determine how much a retiree receives? There's no simple explanation. The short answer is it's sort of complicated.  The longer, more detailed answer is that the amount a retiree receives is dependent on a multitude of factors specified by law, one of which is the maximum guarantee limit, which is adjusted yearly.

Common Misconception: The guarantee limit is often misunderstood to be the maximum benefit PBGC can pay retirees. However, that is not the case.

In many cases retirees receive benefits from PBGC in excess of the maximum guarantee. Whether a retiree receives more than the guarantee depends on a number of factors, including:

1. What the retiree's earned benefit was before the plan terminated

2. How long they've been retired when PBGC takes over

3. The plan's funded status at termination

4. Whether any other limitations apply

FACT: According to a 2006 study, about 85% of retirees who get their pension from PBGC receive their entire earned benefit.

FACT: The guarantee is lower for those who retire early or when there is a benefit for a survivor.

FACT: The guarantee is increased for those who retire after age 65.

Find out more about the maximum insurance benefit.