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Author: Pension Lawyer Eva Cantarella

Pension Annuity Versus Pension Lump Sum: Which is Better?

Pension Annuity Versus Pension Lump Sum: Which is Better?

There are two basic types of pension plans: (1) defined benefit (DB) plans, which provide a guaranteed benefit based on a defined formula set forth in the plan; and (2) defined contribution (DC) plans, such as 401(k) plans, which provide an individual account for each participant and for benefits based solely on the amount contributed to the account and any income, expenses, gains, or losses allocated to the account. DB plans must provide the benefit in the form of a…

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Underfunded Pension Plans; The PBGC; And What The Heck Got Us Into This Pension Funding Mess?

Underfunded Pension Plans; The PBGC; And What The Heck Got Us Into This Pension Funding Mess?

You would need to be asleep at the wheel to not know we are in a pension funding crisis. Hardly a day goes by when we do not hear about a pension plan that reduces or freezes future benefit accruals to lessen its funding shortfall, or that is predicted to become insolvent in the foreseeable future notwithstanding such benefit adjustments. Participants in these underfunded plans naturally worry that they will lose their hard-earned pension benefits. If the plan is in…

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