Underfunded pension plan

(redirected from Underfunded Pension Plans)

Underfunded pension plan

A pension plan that has a negative surplus (i.e., liabilities exceed assets).

Underfunded Pension Plan

A pension plan that has more liabilities than assets. That is, the retirees covered under the pension plan have been promised more than the plan contains. This may happen for a variety of reasons, such as the pension's investments not going as expected, or perhaps retirees are living longer than expected. It can lead to bankruptcy, though some pension plans have government guarantees.
References in periodicals archive ?
Brown has criticized Raimondo's decision to overhaul the state's underfunded pension plans when she was treasurer in 2011, cutting pension payments to save billions, which angered some retirees.
New York: A wide ranging proposal to address Kentucky's underfunded pension plans could gradually improve the commonwealth's credit as large and growing pension obligations have been one of its key rating challenges, Fitch Ratings says.
Moreover, underfunded public pension plans have factored into resolutions of a number of recent, large municipal bankruptcies and it is likely that future municipal bankruptcies will also involve, in one way or another, underfunded pension plans." This language is a matter of concern.
What are we going to do about all these underfunded pension plans? Pension plans are also not handouts but postponed compensation coupled with promises that employers have made to workers who've agreed to these compensation practices and who've therefore created profits for their employers.
Eltife raised concerns about shoring up underfunded pension plans and putting more resources into transportation and higher education.
Significantly underfunded pension plans require additional cash contributions and the amortization of pension losses, tempting managers to opportunistically increase the ERR.
The disconnect between conventional wisdom and the sorry state of many underfunded pension plans is not an abstraction or academic concern; it is hitting home.
In exchange, Detroit would get millions to bolster its two underfunded pension plans, one for police and firefighters, the other for general city workers.
And a number of large companies have had to make sizable contributions to their underfunded pension plans over the last couple of years.
In 2012, 155 underfunded pension plans terminated, with the PBGC stepping in to cover their benefit promises.