More Failed Pension Plans Are Coming

This chart shows the amount of money that has been paid out by the government sponsored Pension Benefit Guarantee Corporation to failed private pension plans.  Congress's recently passed budget deal hiked the required premium private companies pay into the plan.  However, with the ridiculous return assumptions that many of these plans have, we suspect we're going to be hearing a lot more about failed defined benefit pension plans in the coming years.

Source: CNBC

Source: CNBC

For example, as we wrote about here, AT&T has enormous defined benefit pension obligations, but based on their investment allocation they're simply not going to hit their 7.75% annual return target over the long-term. Especially considering the US Federal Reserve may finally be getting more hawkish and bringing an end to the easy money that fueled the incredible stock market rally we've seen over the last six years.

The bottom line here is that you really can't count on your employer of the government to take care of you in retirement.  It's a good idea to sock away a little money whenever you can, and Blue Harbinger Stocks is a great place to start.  Be smart.

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