If you’re among those rare employees with a pension, you may be relieved as you plan for retirement. But can you count on this payout?
Yet fears about your employer’s decline — or even a filing for Chapter 11 bankruptcy protection — need not cause panic. The company’s pension plan can remain intact amid ownership changes, massive layoffs and other upheavals. “There’s twofold protection,” said Colin Slabach, assistant professor of retirement at the American College of Financial Services in King of Prussia, Pa.
“The PBGC is essentially insurance,” Slabach said. “Most people will receive a reduced benefit if PBGC takes over, but it’s still a nice means of protection.” Even if you’re assured that the money will be there if you wait, there are other considerations. For example, it can get complicated for married retirees who, upon their death, want their widowed spouse or child to continue receiving pension benefits. Advisers can help clients understand their plan’s survivor benefits.
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