Newspaper article The Florida Times Union

44.3 Million Have Pensions Guaranteed by Government

Newspaper article The Florida Times Union

44.3 Million Have Pensions Guaranteed by Government

Article excerpt

Byline: CHRISTOPHER CALNAN

Winn-Dixie Stores Inc.'s retirement plans are unlike conventional pension plans because they're not guaranteed by the federal government. And not all the workers who signed on for the plans knew they weren't guaranteed.

Typical pensions plans (in which the employer makes contributions) are covered by the Pension Benefit Guaranty Corp., which has guaranteed U.S. pensions since 1974. If a company goes bankrupt or terminates its pension plan, PBGC assumes the payments up to $45,614 a year -- sometimes at reduced levels.

For example, at age 55, the maximum monthly payment by PBGC is $1,710.51; 60, $2,460.74; 65, $3,801.14. The PBGC says it covers nearly 44.3 million Americans in 31,000 pension plans.

In 2004, Florida residents received more than $221 million from the PBGC, ranking the state third in money received by PBGC.

Pennsylvania ranked No. 1 with $514.9 million; Ohio was No. 2 with $325 million.

But the PBGC's money pot isn't bottomless. It's operating at a $23 billion deficit and may need its own bailout in a decade or so, analysts say. Its assets are $40 billion, but its liablities are $63.6 billion.

Half of all U.S. workers in private industry participate in some type of retirement plan. However, 21 percent of the workers participate in defined benefit pension plans, according to the U. …

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