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Honored Contributor
Posts: 25,929
Registered: ‎03-09-2010

Re: Pension Fund in Critical Status -- OH NO!!!

This happened about 30 years ago(pre IRA) so take that into consideration - my DH's company was sold and along with it , the pension fund. The new company did not currently have a pension plan nor did they want to get involved with one  so they returned to each employee exactly what he had deposited in his fund. None of the money that the company had put in - no interest or earning it had accrued etc. They kept all that, all the employees got was reimbursed their contribution. So , at 43 years old my DH had to start all over from scratch to save for his retirement.

Trusted Contributor
Posts: 1,870
Registered: ‎03-11-2010

Re: Pension Fund in Critical Status -- OH NO!!!

husband just retired - took his money in one lump sum as he doesn't trust the monthly check to continue as promised. will make 5x the money investing it. my dad did the same thing. we remembered sparrows point/bethelem steel as those workers lost everything when they went belly up.

Trusted Contributor
Posts: 1,140
Registered: ‎06-20-2015

Re: Pension Fund in Critical Status -- OH NO!!!

I googled "pension fund in critical status" and got:

 

Critical, Critical and Declining, Endangered and WRERA Status Notices

Under Federal pension law, if a multiemployer pension plan is determined to be in critical status (a plan in critical and declining status is considered to be a plan in critical status) or endangered status, the plan must provide notice of this status to participants, beneficiaries, the bargaining parties, the Pension Benefit Guaranty Corporation, and the Department of Labor. This requirement applies when a plan has funding or liquidity problems or both as described in the Federal law. If a plan is in critical status, adjustable benefits may be reduced and no lump sum distributions in excess of $5,000 can be made. If a critical status plan is also critical and declining, the plan sponsor may file an application with the Secretary of the Treasury requesting a temporary or permanent reduction of benefits to keep the plan from running out of money.  Pension plans in critical and endangered status are required to adopt a plan aimed at restoring the financial health of the pension plan. 

Participants with questions regarding the notices should first contact your plan administrator. If you still have questions, contact the Department of Labor's Employee Benefits Security Administration electronically at https://www.askebsa.dol.gov/ or by calling toll-free 866-444-3272.

Notices may be emailed to the Department of Labor or mailed to the following address:

U.S. Department of Labor
EBSA Public Disclosure Room, N-1515
200 Constitution Avenue NW
Washington, DC 20210

Requesting Copies of Notices

Copies of these notices are available upon request from EBSAs Public Disclosure Room. Send requests for copies of documents to:

U.S. Department of Labor
EBSA Public Disclosure Room, N-1515
200 Constitution Avenue NW
Washington DC 20210
Tel (202) 693-8673
Email foiarequest@dol.gov

Learn more about how to request documents from the Department of Labor in the EBSA publication How to Obtain Employee Benefit Documents from the Department of Labor.

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Respected Contributor
Posts: 4,206
Registered: ‎08-08-2011

Re: Pension Fund in Critical Status -- OH NO!!!

I read that the government pension protection fund will not have enough to cover all of the pension funds that run out over the next several years. 

Honored Contributor
Posts: 14,977
Registered: ‎09-01-2010

Re: Pension Fund in Critical Status -- OH NO!!!

West Virginia coal miners and their surviving spouses have been dealing with this type of situation for the last 20 years!

Honored Contributor
Posts: 20,019
Registered: ‎08-08-2010

Re: Pension Fund in Critical Status -- OH NO!!!

They can pass all the laws they want to protect pension funds, they can government or private insure them as well, but the bottom line is if enough of them go bust, and many people think they will eventually, there won't be enough money to cover them all. It's kind of like FDIC insurance. If enough people have to draw on it, there doesn't begin to be enough money to cover all it is supposed to.

 

It's a sad state of affairs and very frightening for those that worked and earned them. 

Honored Contributor
Posts: 8,348
Registered: ‎03-10-2013

Re: Pension Fund in Critical Status -- OH NO!!!

I cashed out my pension (lump sum vs. monthly) which was mailed directly to our financial company about four years before retirement. I didn’t have to pay any special taxes since I didn’t touch it. However I contributed to my 401k for many years so I’d advise your husband to continue contributing to it.

 

I hadn’t been with the company since 1994 due to a voluntary resigning prior to eventual layoff. Oil business.

Esteemed Contributor
Posts: 7,588
Registered: ‎08-19-2014

Re: Pension Fund in Critical Status -- OH NO!!!

  I would call an attorney who specializes in pension funds ASAP!! I know several people who worked for 40 years just to be told that their promised pensions didn’t exist anymore.

   Good luck!!

Contributor
Posts: 73
Registered: ‎08-07-2012

Re: Pension Fund in Critical Status -- OH NO!!!

My husband gets two downsized pensions from the Pension Guaranty Board, I think a separate entity managed privately but I believe it’s a government monitored agency.  He worked for two companies in the alumunum industry that failed all all pensions monies reverted to their (Pension Guaranty) management.  When time came to retire we received much lower monthly pension payments than the company would have been responsible to pay. 

 

Esteemed Contributor
Posts: 5,763
Registered: ‎03-21-2010

Re: Pension Fund in Critical Status -- OH NO!!!


@Happiness Is Inside JOB wrote:

I'd love to hear your opinions on this issue.  My husband received a letter from his Employers Pension Fund that the fund is in critical status.  OH NO!!! I'm worried that he will evenually get the news that their is no pension for him to recieve.  He is placing money in a 401K outside the job but this is disheartening news.

 

Do you know anyone who experienced this or do you have any advice or suggestions?  All commetns welecome.


@Happiness Is Inside JOB ..... l would first check to see if the letter he received is legitimate...... there are so many scams going around you can’t be too careful nowadays.... better safe than sorry