Unfunded pension plan

(redirected from Unfunded Pension)

Unfunded pension plan

Provides for the employer to pay out amounts to retirees or beneficiaries as and when they are needed. There is no money put aside on a regular basis. Instead, it is taken out of current income.

Unfunded Pension Plan

A pension plan where a former employer pays pensioners out of current income. That is, the employer does not place money aside or invest funds on a regular basis to finance the pension. Obviously, an unfunded pension carries higher risk for both the pensioner and the employer; if the company goes through a difficult period, the pensioner may not have a pension for all his/her retirement while the employer has higher current liabilities.
References in periodicals archive ?
The City of Del Mar is requesting proposals from qualified and capable firms to provide investment management services or to provide established pension programs for the purposes of managing the Citys pension reserve fund to (invest the funds separately in a higher yielding portfolio) and to reduce the Citys unfunded pension liability and pension costs.
Bank Leumi said that calculation of the capitalisation interest on liabilities for first generation employees at the bank entitled to an unfunded pension would be conducted according to the average yield during the past eight quarters on government bonds, plus the spread of the yields on AA-rated corporate bonds in the US.
Collins and Rettenmaier (2010, 451) recalculated the liabilities of 153 state and local pension plans and found their unfunded pension liabilities to be $2.
This has left some states with seriously unfunded pension plans and no good options to make catch-up payments.
Summary: The Aa2 rating also takes into consideration the province's unfunded pension liability
2 billion in municipal bonds of the real risk involved by failing to disclose the impact of the unfunded pension liability on the state's ability to manage its other obligations.
More than $1 trillion in unfunded pension promises made to current and retired government employees are straining state budgets, prompting policymakers to find alternative ways to design retirement plans.
1 billion in cash and assume unfunded pension liabilities estimated at $225 million as of June 30, 2013.
The report, Promises Made, Promises Broken--The Betrayal of Pensioners and Taxpayers, also identifies states where taxpayers and public employee pensioners are most threatened from unfunded pension promises including Illinois, Ohio, New Jersey, Oregon, Connecticut, Nevada, New Mexico, Hawaii and Alaska.
State Budget Solutions calculated those totals using each state's debt amount using each state's regular debt, the fiscal year 2013 budget gap, outstanding unemployment trust fund loans, unfunded post-employment benefit liabilities, and the state's unfunded pension liability.
19 trillion, including outstanding bonds, unfunded pension commitments and budget gaps, according to a new report.
According to the parties, the transfer will simplify the administration of the defined benefit pension plan for Aeroplan and its eligible employees and will not result in Aeroplan assuming a material unfunded pension obligation on the basis of the most recent actuarial valuation report.