PBGC 2011 Maximums Flat Compared to 2010

October 19, 2010 (PLANSPONSOR.com) – The Pension Benefit Guaranty Corporation (PBGC) announced that the maximum annual insurance benefit for participants in underfunded pension plans terminating next year will be $54,000 for those who retire at age 65 – the same as in 2010.

The agency said in a news release the PBGC maximum insurance benefit is indexed to a contribution and benefit base in Social Security law. Because that amount does not increase for 2011, the PBGC maximum insurance benefit is likewise unchanged from 2010.

If a pension plan terminates in 2011 but a participant does not begin collecting benefits until a future year, the 2011 maximum insurance limits still apply, according to the PBGC. For plans that terminate while the plan sponsor is in bankruptcy proceedings, the Pension Protection Act of 2006 provides that the maximum benefit payable is determined by the legal limits in force on the date the plan sponsor filed for bankruptcy and not on the date of plan termination.

Two additional legal limits on PBGC’s insurance coverage can also affect participants’ benefits: The first prohibits the PBGC from guaranteeing benefits that exceed the amount payable at the plan’s normal retirement age while the second limits PBGC’s guarantee of benefit increases made within the five years prior to plan termination, or the date the sponsor filed for bankruptcy, if the sponsor is in bankruptcy when the plan terminates.

PBGC 2011 Maximum Benefits

The following Pension Benefit Guaranty Corporation chart shows the 2011 annual and monthly maximum benefit guarantees for retirees from age 75 to 45. The maximum amount is lower for benefits commencing at ages below 65, reflecting the fact that younger retirees receive more monthly pension checks over a longer expected remaining lifespan. The maximum amount is higher for benefits commencing at ages above 65, reflecting the fact that older retirees receive fewer monthly pension checks over their expected remaining lifespan.  

Age      Annual Maximum           Monthly Maximum         Monthly Joint and 50% Survivor Maximum* 

75         $164,160.00                  $13,680.00                    $12,312.00

74         $149,256.00                  $12,438.00                    $11,194.20

73         $134,352.00                  $11,196.00                    $10,076.40

72         $119,448.00                  $9,954.00                      $8,958.60

71         $104,544.00                  $8,712.00                      $7,840.80

70         $89,640.00                    $7,470.00                      $6,723.00

69         $80,460.00                    $6,705.00                      $6,034.50

68         $72,360.00                    $6,030.00                      $5,427.00

67         $65,340.00                    $5,445.00                      $4,900.50

66         $59,400.00                    $4,950.00                      $4,455.00

65         $54,000.00                    $4,500.00                      $4,050.00

64         $50,220.00                    $4,185.00                      $3,766.50

63         $46,440.00                    $3,870.00                      $3,483.00

62         $42,660.00                    $3,555.00                      $3,199.50

61         $38,880.00                    $3,240.00                      $2,916.00

60         $35,100.00                    $2,925.00                      $2,632.50

59         $32,940.00                    $2,745.00                      $2,470.50

58         $30,780.00                    $2,565.00                      $2,308.50

57         $28,620.00                    $2,385.00                      $2,146.50

56         $26,460.00                    $2,205.00                      $1,984.50

55         $24,300.00                    $2,025.00                      $1,822.50

54         $23,220.00                    $1,935.00                      $1,741.50

53         $22,140.00                    $1,845.00                      $1,660.50

52         $21,060.00                    $1,755.00                      $1,579.50

51         $19,980.00                    $1,665.00                      $1,498.50

50         $18,900.00                    $1,575.00                      $1,417.50

49         $17,820.00                    $1,485.00                      $1,336.50

48         $16,740.00                    $1,395.00                      $1,255.50

47         $15,660.00                    $1,305.00                      $1,174.50

46         $14,580.00                    $1,215.00                      $1,093.50

45         $13,500.00                    $1,125.00                      $1,012.50

*Both spouses the same age. 

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