Finding a Lost Pension

This booklet provides help in defining, planning, and conducting a search for a “lost” pension. There are no guarantees of success. Perhaps the only certainty is that without an effort to locate the pension fund, whatever money may be owed to you will never be yours.

Defined benefit plan: A pension plan that contains a formula for determining each worker’s pension benefits (based on such factors as annual earnings, length of service, and age of retirement). The employer is responsible for maintaining enough money in the pension fund to meet the plan’s obligations, usually the payment of a monthly annuity to the plan participant and survivor benefits to that participant’s spouse.

Defined contribution plan: A plan in which the employer and/ or the employee put money into the fund but the benefits are not specified. The employee is entitled to the amount of money put into the fund in his or her name, plus whatever interest has accumulated. These plans have become increasingly common in recent years; examples include profit sharing and 401( k) plans.

ERISA (Employee Retirement Income Security Act): Federal law passed in 1974 in response to notorious instances in which pension funds had been mishandled or had disappeared entirely. ERISA tightened the standards for the management of pension plans and gave regulatory powers to the Department of Labor and the Internal Revenue Service. A number of subsequent amendments and laws since 1974 have strengthened ERISA’s protections.

PBGC (Pension Benefit Guaranty Corporation): A federal corporation established under ERISA to take over the payment of pension benefits in cases where corporate sponsors of defined benefit pension plans have gone bankrupt or have otherwise ceased operations.

Plan administrator:The individual (or sometimes the corporate department) responsible for maintaining a pension plan, keeping records on individual participants, and overseeing the payment of benefits under the plan.

PWBA (Pension and Welfare Benefits Administration): Agency within the U. S. Department of Labor whose responsibilities include the regulation of pension plans.

Vesting:The point at which a participant becomes entitled to a nonforfeitable benefit under the terms of the plan. A pension plan will specify the length of service required for vesting.