Yahoo Finance How to Find a Lost Pension Plan
Some people lose track of their pension plan from an old job. A company might merge with or be bought by another company and change its name, move to a new location in a different city or go out of business. When this happens, your pension is not necessarily lost, but it might take a little research to find it. Here's how to locate retirement benefits from a former employer.
Contact your former employer. The first step is to reach out to your former company or its successor. Try to contact the plan administrator of your pension plan or another pension plan yours was combined with. A new company may have inherited the legal obligation to pay the benefits of your former employer's pension plan. You can search for news about corporate bankruptcies and mergers, contact former co-workers or reach out to a union associated with the company for more information about who is now in charge of the plan. Pension plan annual financial reports, which are part of federal form 5500, may help identify a person to contact, such as the plan's accountant, trustee or attorney.
Consider financial and insurance companies. Your former employer may have turned over your pension plan assets to an insurance company, which now has the obligation to pay out annuity benefits to eligible participants. Sometimes a financial institution will administer a pension plan and hold money for pension participants who could not be located and paid.
Search at the Pension Benefit Guaranty Corporation. The Pension Benefit Guaranty Corporation insures private sector traditional pension plans, and pays out benefits up to certain limits if the plan fails. The PBGC has a database of unclaimed pensions that lists approximately 38,000 people who are eligible for pension payments that could not be located by the PBGC or their former employer. For example, 2,309 former United Airlines employees are eligible for pension payments they have not claimed. So are 1,485 former employees of the mass-merchandise chain W.T. Grant. Other companies with large numbers of unclaimed pensions include Nortel Networks (1157), Circuit City Stores (687) and US Airways (522). Residents of New York have the most unclaimed pensions (6401), followed by Illinois (4379), California (2856) and Texas (2189). The PBGC says these unclaimed pensions are collectively worth over $200 million, and individual benefits range from a few dollars to almost a million dollars.
The PBGC does not insure 401(k) plans. It also usually doesn't insure pensions provided by groups of doctors, lawyers and other professionals with fewer than 26 employees, religious groups or federal, state and local governments.
Collect the paperwork. An individual benefit statement or an exit letter noting your participation in the plan can help prove your eligibility for payments. Pay slips and W-2 forms that show your employment dates and earnings can also signify eligibility. When you sign up for Social Security and Medicare, the Social Security Administration sends a notice of potential private pension benefit information to people who may be due pensions.
Look into spousal payments. Defined benefit pension plans sometimes provide married workers with a qualified joint and survivor annuity, which entitles the surviving spouse to a payment. If you are married to someone with a pension, it's worth looking into the payments you might qualify for, even if the worker has passed away.
Make sure you are vested. You need to be vested in a pension plan to qualify for benefits. Once you are vested in a retirement plan you are eligible for benefits at retirement age, regardless of when you left the job. A summary plan description typically explains the plan's rules for vesting. Some pension plans vest in as little as five years, while others require 10 or even 20 or more years of service to qualify for payments in retirement. If you are not vested in the pension plan, you typically are not eligible for payments.
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