Pension Benefit Guaranty Corporation (PBGC)
Contents
Unlocking the Pension Benefit Guaranty Corporation (PBGC): A Comprehensive Guide
Exploring the PBGC
Delve into the role and function of the Pension Benefit Guaranty Corporation (PBGC), a vital U.S. government agency ensuring the stability of private-sector pension plans. Learn about its history, coverage, and recent legislative changes.
Understanding the PBGC's Mandate
Discover how the PBGC, established under the Employee Retirement Income Security Act of 1974 (ERISA), safeguards the retirement benefits of workers by stepping in when defined-benefit plans face financial distress. Learn about its funding sources and the recent American Rescue Plan Act's impact on multiemployer pension plans.
Coverage and Limitations
Learn about the scope of coverage provided by the PBGC, including benefits for normal and early retirement, survivor annuities, and disability benefits. Understand the limitations and maximum benefits guaranteed by the PBGC for single-employer plans, ensuring retirees are informed about their pension entitlements.
Historical Context
Explore the historical context that led to the creation of the PBGC, including the lack of protections for worker pensions prior to federal legislation. Discover the pivotal role of ERISA in establishing the PBGC and providing crucial safeguards for pension plans.
Fact Check:
- The PBGC covers pension benefits for workers in the private sector but does not extend coverage to public sector workers.
- The PBGC's funding primarily comes from insurance premiums paid by employers sponsoring insured pension plans.
- As of December 2020, the PBGC insured retirement incomes for nearly 25,000 defined-benefit plans, covering approximately 34 million U.S. workers and retirees.