Pension News

With Mother’s Day approaching, it seems only fitting that I put in a plug for the current edition of Mother Jones magazine. Its cover asks, “Who Ran Away With Your 401(k)?” and the issue is required reading for anyone interested in the future of retirement income.   (more…)

Today, April 28, is Equal Pay Day, in recognition of the fact that on average women earn less than men. For women, as former Congresswoman Patricia Schroeder once noted, this discrimination throughout their lives “strikes its cruelest blow at the end.”

The Lily Ledbetter Equal Pay Act of 2009 will not only help close the wage gap for women who have experienced pay discrimination in the workplace, but it will also help close the pension gap. (more…)

Are you a retiree from the auto industry?  The Pension Benefit Guaranty Corporation, the federal agency that guarantees pensions, has provided helpful information for retirees of Ford, General Motors, Chrysler, and other car companies.  

The PBGC guarantees pension benefits up to a certain limit for retirees of companies that have gone bankrupt and are unable to fulfill their pension obligations.  Unfortunately for some retirees, the PBGC maximum guarantees may be less than what their pension is worth.  For more information on how the PBGC protects defined benefit pensions, read our fact sheet.

Do you tweet on Twitter? We do! The Pension Rights Center has joined Twitter, a social networking platform that allows users to let their “followers” know what they’re up to on a regular basis. Check out the Center’s Twitter feed, @PensionRights, and sign up to follow our tweets.

Last week, the U.S. House of Representatives approved a Roth alternative in the Thrift Savings Plan for government employees. Roths are the antithesis of sensible tax and budget policy. Rather than expanding them to federal employees, Congress should scrap them.

As most of us know, there are now two choices in both IRAs and 401(k)s. With a traditional IRA or 401(k), the contribution is not taxed when made, but distributions from the retirement plan are taxable. In both Roth IRAs and Roth 401(k)s, the contribution is taxed in the year that it is made, but distributions are tax-free.

The advantage of either alternative is the same — the elimination of tax on investment income. The difference is when the money is taxed.  This may seem like a minor difference, but the amount of money that you can accumulate tax-free can be greater in a Roth. (more…)

These days, it’s not often that we agree with the decisions companies make when it comes to pensions (take a look at our lists of companies that have frozen their pensions or that have cut their 401(k) matches), but an activist alerted us to one company that is actually doing the right thing. As reported in the Times of Northwest Indiana last week, steel giant ArcelorMittal is forgiving $960,000 in pension overpayments made to 79 widows of retired workers. Many of these women are in their 80s and 90s and have relied on their survivor’s pension for decades. Having to pay back years of overpayments would have been a severe hardship for them. (more…)

With tax day approaching, Andrea Coombes of MarketWatch.com has written a helpful column about the Making Work Pay credit, a 2009 tax credit given to all working Americans with earnings under a certain amount. To implement this credit, the I.R.S. has issued new tax withholding tables. However, as she notes, implementing the tax credit through withholding tables are a  ”blunt instrument”, resulting in some workers having too much taken out of their paychecks or having too little withheld. (more…)

In the uproar over the million-dollar bonuses given to AIG executives, AIG’s defenders claimed that the company was forced to give out these bonuses because of contracts it signed with the executives.  In Sunday’s St. Petersburg Times, columnist Robyn Blumner uses AIG and United Airlines to make a terrific point about the disgraceful inequities in bankruptcy laws that give rank-and-file workers’ pensions the shaft, while executives can still walk away with millions.  Give it a read. (more…)