We lead complicated lives. We move from state to state, we change jobs more often than we change hairstyles, and we even change careers at least once or twice in a lifetime. It's no wonder that we sometimes lose track of our promised pension benefits.
You've got money!
To put some small measure on the amount of money we're forgetting to collect, the Pension Benefit Guaranty Corporation reported this month that it's sitting on $133 million in unclaimed pension benefits owed to 32,000 people. You can find out if you might be one of those missing beneficiaries by using their pension benefit search directory.
Individual benefits owed to these missing people average about $4,950, but they range up to $611,028. Especially if you worked in the airline, steel, transportation, machinery, retail trade, apparel, or financial services industry in a company that went bankrupt or closed its pension plans, it's worth taking a look at the agency's directory just to make sure you're not missing out on something.
It's the PBGC's job to manage those terminated plans. If that acronym sounds vaguely familiar, it may be because the organization has been taking over pension plans for many companies with financial difficulties, including US Airways
Not just for bankrupt employers
But a company doesn't have to close its pension to lose track of some beneficiaries. You may be due benefits from your very first job, back when you didn't know a pension from a potato. Collecting those benefits may be as simple as calling up the company. Sometimes it's not so easy. That business may have since moved, changed names, been bought or merged with another company, divided, or just simply disappeared.
If that's the case, one of several things may have happened to the pension plan:
- Even if the company doesn't remain in the same form you remember, the new company may have the legal obligation to make good on old pension promises.
- The plan may have bought an annuity contract from an insurance company, which then took over the plan's payment obligations.
- A financial institution may be managing the plan.
- The plan may have been taken over by the PBGC.
- The plan may have disappeared. Though usually illegal, it's not out of the realm of possibility.
Getting your money
It's up to you to find out what happened to the plan. The Labor Department and the PBGC may be able to give you a head start tracking down the company and your money. You might also seek help from former coworkers, a union, or the local Chamber of Commerce.
A pension counselor who specializes in tracking down lost benefits may be particularly useful. You can find some referrals, along with lots of other detailed advice, in the PBGC's guide for finding a lost pension.
Keep in mind that just because you worked for a company, that doesn't mean they automatically owe you a monthly retirement check. The rules for vesting in a company's pension plan have changed over the decades, and employees used to be required to put in a lot of years before an employer owed them anything. If you can find any documentation at all about benefits from your old jobs, you may be able to figure out whether you're owed some money.
If you are owed some money you had forgotten about, it could certainly make your retirement a little bit happier, like finding an unexpected check stuck between the sofa cushions every month.
You can get help managing not only your pension but all your other retirement benefits by using the Rule Your Retirement newsletter and its many discussion boards. You might also take a peek at these related articles:
Fool contributor Mary Dalrymple doesn't expect any pension checks to appear between her sofa cushions, alas. She doesn't own shares of any companies mentioned in this article and welcomes your feedback. The Motley Fool has a disclosure policy.