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I've been doing what I can to gain knowledge on my pension but some details I can't work out or rather specific questions

Like this one.

When a pension plan is underfunded how much is too much and how long is too long.

I've seen articles claiming the 80% limit is a myth and I've seen articles claiming anything under 90% for 3 consecutive years is risky.

So what's the deal? My pension has been under 90% funding for as long as I can remember.

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  • You need to provide more information if you want to get a reasonable answer. Who is providing the pension? A company? A government? In which country or state? What does the pension plan say? For example, recently the State of Illinois (with vastly underfunded employee pension plans) tried to renege on its pension obligations on the grounds that it had no money to pay them; what money it had needed to be used for public safety etc, Fortunately for the pensioners, the courts shot this down: state pensions are contracts whose terms cannot be changed by the state unilaterally. (continued)
    – Dilip Sarwate
    Apr 14, 2017 at 14:01
  • (Continuation) On the other hand, if a company reneged on its pension obligations, say by going bankrupt, the employees (future pensioners) and current pensioners might be SOL because they would just be creditors who are owed money, and not in the first line of creditors either; the tax man, and banks etc who had loaned the company money are first in line, and employees and pensioners would likely receive a small lump sum, way too little to be invested in order to produce the promised retirement income.
    – Dilip Sarwate
    Apr 14, 2017 at 14:10
  • @DilipSarwate: in US (which asker's profile indicates) essentially all private pension plans are insured (up to a limit) against the employer's bankruptcy by en.wikipedia.org/wiki/Pension_Benefit_Guaranty_Corporation .
    – dave_thompson_085
    Apr 15, 2017 at 0:53

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