Retired people are typically not the kind who would be able to afford to not be paid what they are owed in pension and benefits. And yet, the government agency that administers retirement pension payments for American workers, known as the Pension Benefit Guaranty Corp., has just worked out that it owes about 50,000 people out there nearly $250 million in defined benefit pension plans that have been terminated.
What are these pension plans? Companies that offer pension plans to their workers sometimes shut down due to losses. When they do that, they terminate their retirement pension plans and sometimes neglect to do anything about the millions of dollars they’ve set aside for the pensions over the years. Those 50,000 people the government just tracked down are the ones who at least find a place on some record for what they are owed. The government suspects that are thousands of retired people who’ve had their employers shut down, merge, spinoff or do any of a number of other things, and totally lost track of the retirement pension benefits.
These are people who have their names on no record; there is no government body that looks after their interests, and there is no database that knows anything about them. If they believe that they are owed something, they’ll need to go on the trail themselves to track something down. A process that could cost a lot of money in itself and offer no guarantee of success in the end. Most of the 50,000 people that the government just found out about, are merely people who moved or changed their names or something, and forgot to tell her former employers (former, not just because they don’t employ those people anymore, but also because they don’t exist as businesses anymore).
So if these poor retirees actually found a way to reclaim their lost retirement pension dues, how much would they actually make? Usually, it is something that would make a big difference to their lives – the average sum is about $5000 apiece, although some are owed hundreds of thousands. If you believe that you know someone who could be on that list of 50,000 lucky people, you could search on the Pension Benefit Guaranty Corp.’s website. When you find a name and write to the agency, you can expect to be kept waiting about three months for a reply. But what if you’re not on the list, and you still know that you are owed retirement pension back payments?
There are several ways to go about sniffing out a lost pension. You’ll find them listed on the PBGC website. Companies are bought, spun off, merged and close down on a yearly basis these days, and paperwork tends to get lost. If you worked for a company, say 20 years ago, it wouldn’t really make much sense putting in all the work to track down a lost retirement pension. Back then, most companies required that you worked with them your whole life before they gave you a pension. It was only in the mid-90s that rules came about that gave you a pension before that. They’re actually trying to put together a national registry to help you track down your lost pension.
If you happen to be working today and you have a pension to your name, make sure that you keep track of it, should your company close down, or should you move to another company.