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  • Ted March 2019
Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.

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It just became easier for employers to dump retirees' pensions

catch22catch22
in Off-Topic
The article notes about 26 million are currently covered by Defined Benefit Pension plans. I know two who had the lump sum or another annuity/pension provider option.....with the which do you want notice. Both chose a new annuity.
Anyway, it appears this new Treasury Dept. notice opens the door more to existing payouts, not just before one retires.
A lot of legal with all of this and I've not attempted to get inside the particulars. The post is for the benefit of forward knowledge that such an offer may arrive in the mail for someone here.
Personal note: I would opt for the lump sum, if the math was favorable; and take the risk of investment knowledge.
This would also involve the tax status of a lump sum payment. I recall when General Motors was in the crash and burn recovery state; that they arrived at an agreement with the IRS, that lump sum buyouts (at least to skilled trades folks) could have the monies deposited in the employee's 401k plan. Quite the deal, eh? I know one person who received $62,000 immediate to say goodbye to GM (they were already retirement eligible).

LUMP SUM DEFINED PENSION BUYOUT article

Related IRS document, newly revised

Comments

  • TedTed
    @MFO Members: Moral of this article is a "bird in the hand is worth two in the bush."
    Regards,
    Ted
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