Social Security and a defined-benefit pension plan have long been the foundation of a secure retirement. However, use of employer-paid defined pension plans has declined dramatically for non-union workers, in favor of 401(k)s and other investment funds that depend mostly on what employees can save. Union workers are also struggling to retain defined-benefit plans.
According to the Economic Policy Institute, less than 20% of private-sector workers are covered by a traditional pension, and the national savings rate is near zero. So, most Americans will be financially unprepared for their so-called Golden years. Elderly people are also being forced to stay in the workforce later in life.
For years, hundreds of multi-employer pension funds faced declining status with many on the verge of failing. As part of the American Rescue Plan, Congress provided billions of dollars to shore up those troubled pension funds and protect healthy pension funds. President Biden’s action on a final rule through the American Rescue Plan’s Special Financial Assistance will further protect the retirement security of millions of Americans including LIUNA retirees, beneficiaries, and members. The White House plan will provide a life-saving transfusion of federal investment for union members’ multiemployer pensions; saving some funds from insolvency caused by forces outside of their control, and ensuring that pension promises will be met. Millions of retirees—including thousands of LIUNA retirees—and beneficiaries can breathe a sigh of relief, knowing that they will still receive their full pensions and be able to retire in dignity after a lifetime of hard work.
