Going Out of Business

Q. If my company goes out of business, will I lose my pension benefits?

A. Your pension funds should not be at risk when a plant or business closes, since employers are required to comply with federal laws when managing pension plans. The consequences are serious when those assets are not handled properly.

That said, if your company has not adequately funded its pension plan, the federal Pension Benefit Guaranty Corporation (PBGC) would insure your benefits but probably not for the full amount. The PBGC only pays benefits up to a certain maximum amount to workers in that situation.

The U.S. Department of Labor has published a booklet, "Protect Your Pension: A Quick Reference Guide," that can be accessed at www.dol.gov. To receive a copy of the guide, write to:

U.S. Department of Labor
Employee Benefits Security Administration
200 Constitution Avenue NW, Suite N-5625
Washington, DC 20210

Source: John Turner