PBGC Announces Maximum Guarantee for 1998
FOR IMMEDIATE RELEASE
November 12, 1997
The Pension Benefit Guaranty Corporation (PBGC) today announced that the maximum benefit it will guarantee for retirees in underfunded single-employer defined benefit plans that terminate in 1998 will be $2,880.68 per month, or $34,568.16 per year.
The Employee Retirement Income Security Act of 1974 (ERISA) mandates that the maximum guaranteed amount be adjusted annually based on changes in the Social Security contribution and benefit base.
The maximum guarantee applies to workers who retire at age 65 or later. Maximum guarantees are reduced for retirees taking earlier retirement or electing survivors' benefits. In some instances, where a pension plan has adequate resources or PBGC recovers sufficient amounts, a participant may receive benefits in excess of the maximum guarantee.
About 441,000 workers and retirees in 2,348 pension plans rely on PBGC for their retirement income.
The maximum monthly guaranteed amounts for plans terminating each year for the past ten years are:
The 1998 maximum guarantee will be published in the December 15, 1997, Federal Register.
PBGC is a federal corporation created under the Employee Retirement Income Security Act of 1974 to guarantee payment of basic pension benefits earned by more than 42 million American workers and retirees participating in about 50,000 private-sector defined benefit pension plans. The agency receives no funds from general tax revenues. Operations are financed largely by insurance premiums paid by companies that sponsor pension plans and investment returns.
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PBGC No. 98-06