While they are going away for many investors in the private sector, pensions still represent a cornerstone for many state, federal and municipal employees.
So, any hiccups with them can pose plenty of problems for retirees – perhaps even more so when you consider that pensions are supposed to be safe and ‘guaranteed’ sources of income for their participants. With that, it might come as a huge shock that many of the largest pension plans are actually considered ‘underfunded.’ That is, they promise more in payouts and annual income than their assets can safely provide.
What’s worse is that many investors in these plans have no idea that this is even occurring. A new survey could serve as a wake-up call to pension holders to consider saving more on their own.
Be sure to check our Retirement section to know about retirement planning options.