Pension problems can become a reality quicker then you can think. A few years back there were stories about the Spag’s pension, here is the story from the Boston Herald:
Two companies controlled by the daughters of the late millionaire owner of Spag’s Supply Inc. have filed for bankruptcy with $6.1 million-plus in unfunded pension liabilities for 400 former employees of the defunct no-frills discount store.
The bankruptcy petitions filed Friday follow the federal Pension Benefit Guaranty Corp.’s September takeover of the pension fund of Spag’s, which operated in Shrewsbury for 68 years until 2002.
City of Worcester unfunded pension liability is over $400,000,000. Keep in mind that when your pension is taken over by the Pension Benefit Guaranty Corp (PGGC), this does not mean that you pension is safe. PBGC is similar to FDIC that insures the first $100,000 of your monies in the bank. There are maximums that are guaranteed through the PBGC. In other words people that were covered under the Spag’s pension havehad their benefits reduced.