About Half Of Pension Sponsors Have Frozen Plans, Potentially Risking Benefits For Millions

[Purveyor]

Source: Associated Press

6:51 PM EDT, July 22, 2008

WASHINGTON (AP) _ About half of employers with defined-benefit pension plans have frozen one or more of those plans, putting the retirement incomes of millions at risk, according to a government report made public Tuesday.

The Government Accountability Office said more than 3 million people covered by its study, which represented about a fifth of all participants in single-employer defined-benefit plans, are affected by freezes.

Most sponsors with frozen plans have set up retirement savings alternatives, such as 401(k) plans that may offset some losses, but "a freeze generally implies a reduction in anticipated future retirement benefits," the GAO said.

"When companies freeze plans, older employees often experience huge benefit losses and younger workers are left to save for themselves," said Karen Friedman, policy director for the Pension Rights Center. "Congress needs to step up to the plate to develop solutions that encourage companies to preserve their employer-paid, guaranteed pension plans, not freeze them."

Employers often freeze pension plans as a step toward terminating those plans and replacing them with defined-contribution plans such as 401(k) plans. The GAO survey of 471 single-employer defined-benefit plan sponsors found that nearly a third ultimately expect to terminate their largest frozen plan.

Read more: http://www.sun-sentinel.com/news/nationworld/politics/wire/sns-ap-frozen-pensions,0,6213797.story

[my2sense]

1. K & R

[Zhade]

2. WHICH COMPANIES?

NT!

[Purveyor]

3. They weren't named in the article but they may be listed in the GAO report found on their website.

GAO: http://www.gao.gov

[roseBudd]

4. Gannet is one

[Journeyman]

5. And this is why I left corporate America decades ago . . .

they are not your friend and they do not have your interests at heart.

Gonna be plenty of pissed off, disadvantaged retirees in coming decades. Of course, many will clamor for us all to cover their losses but, as you can tell from my decisions, I won't greet the requests with smiles or civility.